Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Healthy Foods Inc. sells 60-pound bags of grapes to the military for $15 a bag. The fixed costs of this operation are $90,000, while the

image text in transcribed

image text in transcribed

Healthy Foods Inc. sells 60-pound bags of grapes to the military for $15 a bag. The fixed costs of this operation are $90,000, while the variable costs of grapes are $0.15 per pound. a. What is the break-even point in bags? (Round your answer to 2 decimal places.) Break-even point bags b. Calculate the profit or loss (EBIT) on 11,000 bags and on 32,000 bags. Profit/Loss Amount Bags 11,000 32,000 c. What is the degree of operating leverage at 19,000 bags and at 32,000 bags? (Round your answers to 2 decimal places.) 14 Degree of Operating Bags Leverage 19.000 32,000 15 points 01:07:47 eBook d. If Healthy Foods has an annual interest expense of $14,000, calculate the degree of financial leverage at both 19,000 and 32,000 bags. (Round your answers to 2 decimal places.) Bags Degree of Financial Leverage 19 000 32,000 e. What is the degree of combined leverage at both 19,000 and 32,000 bags? (Round your answers to 2 decimal places.) Bags Degree of Combined Leverage 19 000 32 000

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

How To Build A Cyber Resilient Organization Internal Audit And IT Audit

Authors: Dan Shoemaker, Anne Kohnke, Ken Sigler

1st Edition

1138558192, 978-1138558199

More Books

Students also viewed these Accounting questions

Question

6. describe the treatment and prevention of burnout.

Answered: 1 week ago