EBIT sensitivity

EBIT Sensitivity Stewart Industries sells its finished product for $9.00 per unit. Its fixed operating costs are $20,000, and the variable operating cost per unit is $5.00. a. Calculate the firm's earnings before interest and taxes (EBIT) for sales of 10,000 units. b. Calculate the firm's EBIT for sales of 8,000 and 12,000 units, respectively. c. Calculate the percentage changes in sales (from the 10,000-unit base level) and associated percentage changes in EBIT for the shifts in sales indicated in part (b). d. On the basis of your findings in part (c), comment on the sensitivity of changes in EBIT in response to changes in sales a. The firm's earnings before interest and taxes is $20000 (Round to the nearest dollar.) b. The EBIT for the 8,000 units level is $ 12000 (Round to the nearest dollar.) The EBIT for the 12,000 units level is $ 28000. (Round to the nearest dollar.) c. The change in sales as a percentage for the 8,000 units level is 20%. (Round to one decimal place.) Click to select your answer(s). OTES ogte 9 LP W 11:28 PM 10/23/2019 EBIT Sensitivity Stewart Industries sells its finishe the variable operating cost per unit is $5.00. uct for $9.00 per unit. Its fixed operating costs are $2 a. Calculate the firm's earnings before interest and taxes (EBIT) for sales of 10,000 units. b. Calculate the firm's EBIT for sales of 8,000 and 12,000 units, respectively. c. Calculate the percentage changes in sales (from the 10,000-unit base level) and associated percentage chang for the shifts in sales indicated in part (b). d. On the basis of your findings in part (c), comment on the sensitivity of changes in EBIT in response to change c. The change in sales as a percentage for the 8,000 units level is 20 %. (Round to one decimal place.) The change in sales as a percentage for the 12,000 units level is 20 %. (Round to one decimal place.) The change in EBIT as a percentage for the 8,000 units level is 60%. (Round to one decimal place.) The change in EBIT as a percentage for the 12,000 units level is 40 %. (Round to one decimal place.) Click to select your answer(s). el e 9 wlpi HEWLETT-PACKARD