Management Services

1. For a sales level of 3,000,000; X Corp has DOL of 2x, DTL of 3x and CM ratio is 60%. Compute the Fixed cost.

None of the above

600,000

1,200,000

900,000

2. The following data are available for X Company: Ave Selling price of 16 per unit Variable cost per unit of 11 Units sold is 200,000 Fixed cost is 800,000 Interest expense is 50,000 What is the DFL (Degree of Financial Leverage)?

2.50 times

2.33 times

1.33 times

5 times

3. At present, total outstanding shares of X Corp is 100,000 shares. X Corp issued additional 200,000 share at 20 per share. A, a current holder of 40,000 shares. A must be given the option of to buy for how many shares? (Stockholders have preemptive right)

80,000 shares

200, 000 shares

40,000 shares

50,000 shares