Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Last year Lexington had sales of $841,000 and paid taxes of $50,000. Because of the low interest rate environment , the firm also borrowed some

Last year Lexington had sales of $841,000 and paid taxes of $50,000. Because of the low interest rate environment , the firm also borrowed some money from the local bank and paid $15,000 in interest expense . In addition , the firm incurred Variable costs and Fixed Costs of $332,000 and $423,000 respectively . If sales increase by 5 %, what should be the increase in earnings per share ? SET YOUR CALCULATOR TO 4 DECIMAL PLACES AND ROUND TO 2 DECIMAL PLACES AT THE END . DO NOT ENTER THE % SIGN . IF YOUR ANSWER IS 7.7011 % , FOR EXAMPLE , ENTER 7.70 .
its 2 seperate questions please help image text in transcribed
image text in transcribed
Last year Lexington had sales of $841,000 and paid taxes of $50,000. Because of the low interest rate environment, the firm also borrowed some money from the local bank and paid $15,000 in interest expense. In addition, the firm incurred Variable costs and Fixed Costs of $332,000 and $423,000 respectively. If sales increase by 5%, what should be the increase in earnings per share? SET YOUR CALCULATOR TO 4 DECIMAL PLACES AND ROUND TO 2 DECIMAL PLACES AT THE END. DO NOT ENTER THE % SIGN. IF YOUR ANSWER IS 7.7011%, FOR EXAMPLE, ENTER 7.70. Last year, Lexington had sales of $693,000 and paid taxes of $77,000. Because of the low interest rate environment, the firm also borrowed some money from the local bank and paid $67.000 in interest expense. In addition, the firm incurred Variable costs and Fixed Costs of $273,000 and $163,000 respectively. If sales increase by 5%, what should be the increase in operating income?SET YOUR CALCULATOR TO 4 DECIMAL PLACES AND ROUND TO 2 DECIMAL PLACES AT THE END. DO NOT ENTER THE % SIGN. IF YOUR ANSWER IS 7.7011%. FOR EXAMPLE, ENTER 7.70

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

Step: 3

blur-text-image

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

Principles Of Finance

Authors: Scott Besley, Eugene F. Brigham

2nd Edition

003034509X, 9780030345098

More Books

Students also viewed these Finance questions

Question

What are some characteristics of a good termination manager?

Answered: 1 week ago