( IIlarks) Fantastic Toys produces beach balls, selling 800,000 balls a year. Each ball produced has a variable cost of $1.68 and sells for $2. Fixed operating costs are $56,000. The firm has annual interest charges of $36,000, preference share dividend payments of $8,000 and 30% tax rate. Required: Calculate the degree of operating leverage and interpret your result. ii. Calculate the degree of financial leverage and interpret your result. iii. Determine the degree of total leverage and discuss the combined effect of operating leverage and financial leverage