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Degree of financial leverage Parker Investments has interest expense of $6,000, and preferred dividends of $5,000. If it pays taxes at a rate of 37%,

Degree of financial leverage Parker Investments has interest expense of $6,000, and preferred dividends of $5,000. If it pays taxes at a rate of 37%, what is Parkers degree of financial leverage (DFL) at a base level of EBIT of $40,000?

Shelbys Photographs has fixed operating costs of $16,500 and variable operating costs of $8 per photograph pack. The photograph packs sell for $20 each. How many photograph packs must be sold for the firm to break even in terms of EBIT?

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