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Consider a four-year project with the following information: initial fixed asset investment = $570,000; straight-line depreciation to zero over the four-year life; zero salvage value;
Consider a four-year project with the following information: initial fixed asset investment = $570,000; straight-line depreciation to zero over the four-year life; zero salvage value; price = $40; variable costs = $27; fixed costs = $245,000; quantity sold = 88,000 units; tax rate = 22 percent.
Consider a four-year project with the following information: initial fixed asset investment $570,000; straight-line depreciation to zero over the four-year life; zero salvage value price $40; variable costs-$27 fixed costs- $245,000; quantity sold - 88,000 units tax rate 22 percent. a. What is the degree of operating leverage at the given level of output? (Do not round intermediate calculations and round your answer to 4 decimal places, e.g., 32.1616.) b. What is the degree of operating leverage at the accounting break-even level of output? (Do not round intermediate calculations and round your answer to 4 decimal places, e.g. 32.1616.) a. Degree of operating leverage b. Degree of operating leverageStep by Step Solution
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