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Given the following information, which of the following statements is most CORRECT? Historical Year Projected Year Sales 350,000 420,000 EBIT 200,000 250,000 EBT 180,000 236,000
Given the following information, which of the following statements is most CORRECT?
Historical Year | Projected Year | |
Sales | 350,000 | 420,000 |
EBIT | 200,000 | 250,000 |
EBT | 180,000 | 236,000 |
Net Income | 117,000 | 153,400 |
EPS | 1.19 | 1.56 |
A. | The degree of financial leverage is 1.325. | |
B. | The degree of operating leverage is 0.669. | |
C. | The degree of total leverage is 1.555.
| |
D. | Fixed costs and interest expense increased proportionately with sales. | |
E. | None of the other choices is correct. |
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