Question
Given the following financial data for Linda Psychic Technology, compute the firm's degree of combined leverage. Assume a marginal tax rate of 35%. 2010 2011
Given the following financial data for Linda Psychic Technology, compute the firm's degree of combined leverage. Assume a marginal tax rate of 35%.
2010 2011
Sales$700,000. $800,000
Fixed costs175,000. 190,000
Variable costs406,000 448,000
EBIT 119,000. 162,000
Interest 32,000. 36,000
Shares outstanding102,000 101,000
20102011
EBT87000126000
EAT75270111660
EPS0.73791.1055
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Fundamentals of Multinational Finance
Authors: Michael H. Moffett, Arthur I. Stonehill, David K. Eiteman
5th edition
205989756, 978-0205989751
