P13-8 (similar to)

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EBIT Sensitivity Stewart Industries sells its finished product for $8.98 per unit. Its fixed operating costs are $20,800, and the variable operating cost per unit is $4.48.

a. Calculate the firm's earnings before interest and taxes (EBIT) for sales of12,000 units

.b. Calculate the firm's EBIT for sales of 11,000 and 13,000units, respectively.

c. Calculate the percentage changes in sales (from the 12,000-unit base level) and associated percentage changes in EBIT for the shifts in sales indicated in part (b).

d. On the basis of your findings in part (c),

comment on the sensitivity of changes in EBIT in response to changes in sales.

a. The firm's earnings before interest and taxes is $nothing. (Round to the nearest dollar.)