Question
M Company currently has $2,000,000 in sales. Its variable cost equal 70% of its sales, its fixed costs are $100,00 and its annual interest expense
M Company currently has $2,000,000 in sales. Its variable cost equal 70% of its sales, its fixed costs are $100,00 and its annual interest expense is $50,000. What is the company's degree of operating leverage? What is the company's degree of financial leverage? What is the company's degree of total leverage? If the company's sales increase 10%, how much will the company's net income increase?
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Financial Management For Decision Making
Authors: Harold Jr. Bierman, Seymour Smidt
1st Edition
1587982129, 9781587982125
