Question
Given the following information for Computech, compute the firms degree of combined leverage (dollars are in thousands except EPS). Round your answer to one decimal
Given the following information for Computech, compute the firms degree of combined leverage (dollars are in thousands except EPS). Round your answer to one decimal place.
| Year 1 | Year 2 | |||
| Sales | $700,000 | $784,000 | ||
| Fixed costs | 120,000 | 120,000 | ||
| Variable costs | 200,000 | 224,000 | ||
| Earnings before interest and taxes | $380,000 | $440,000 | ||
| Interest | 40,000 | 40,000 | ||
| Earnings per share (EPS) | $5.10 | $6.00 |
Degree of combined leverage:
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Accounting Information For Business Decisions
Authors: Billie Cunningham, Loren A. Nikolai, John Bazley, Marie Kavanagh, Geoff Slaughter, Sharelle Simmons
2nd Edition
0170253708, 978-0170253703
