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P2.12 Nadia, a housewife, is an excellent cook. The husband's wage was inadequate to make ends meet. She decided to try her hands in the

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P2.12 Nadia, a housewife, is an excellent cook. The husband's wage was inadequate to make ends meet. She decided to try her hands in the making of doubles (a Trinidadian delicacy) which she wholesaled to Persad's Supermarket at a price of $3.00 each. Each doubles has variable operating costs of $1.75. Fixed operating costs are $25,000 per year. Nadia had to borrow money to start the business and she is required to pay $15,000 interest and preferred dividends of $10,000 per year. The business is selling 100,000 doubles per year and is paying government a 40% tax rate. Required: a. Calculate Nadia's operating breakeven point. b. Given the business's current sales of 100,000 doubles per year and the interest and preferred dividend cost, calculate.Nadia's EBIT and the earnings available for the ownerS. c. Calculate the firm's DOL d. Calculate the firm's DFL e. Calculate the firm's DTL 0 f. Nadia has entered into a contract to produce and sell an additional 25,000 doubles in the coming year to HILO Food Stores. Use the DOL, DFL and DTL to predict and calculate the changes in EBIT and earnings available to the owners. Calculate Nadia's financial break-even point (FBP). g

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