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Check my wor Problem 17-17 Your business plan for your proposed start-up firm envisions first-year revenues of $90,000, fixed costs of $30,000, and variable costs
Check my wor Problem 17-17 Your business plan for your proposed start-up firm envisions first-year revenues of $90,000, fixed costs of $30,000, and variable costs equal to one-third of revenue. a. What are expected profits based on these expectations? Expected profit b. What is the degree of operating leverage based on the estimate of foued costs and expected profits? (Round your answer to 2 decimal places.) Degree of operating leverage c. sales are on below expectation, what will be the percentage decrease in profits? V Check my w c. If sales are 10% below expectation, what will be the percentage decrease in profits? Decrease in profits S e. Based on the DOL, what is the largest percentage shortfall in sales relative to original expectations that the firm can sustain before profits turn negative? (Round your answer to 1 decimal place.) Shortfall What are break-even sales at this point? Break even soos 08 K e. Based on the DOL, what is the largest percentage shortfall in sales relative to original expectations that the firm can su before profits turn negative? (Round your answer to 1 decimal place.) Shortfall f. What are break-even sales at this point? Break-even sales 08 E V N
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