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Please help me to solve question e because is wrong Your business plan for your proposed start-up firm envisions first-year revenues of $120,000, fixed costs
Please help me to solve question e because is wrong
Your business plan for your proposed start-up firm envisions first-year revenues of $120,000, fixed costs of $61,000, and variable costs equal to one-third of revenue. a. What are expected profits based on these expectations? (Round your answer to nearest whole number.) Answer is complete and correct. Expected profit 19,000 b. What is the degree of operating leverage based on the estimate of fixed costs and expected profits? (Round your answer to 2 decimal places.) Answer is complete and corre Degree of operating leverage 4.210 c. If sales are 10% below expectation, what will be the percentage decrease in profits? (Round your answer to nearest whole number.) Answer is complete and correct. Decrease in profits 42% e. Based on the DOL, what is the largest percentage shortfall in sales relative to original expectations that the firm can sustain before profits turn negative? (Round your answer to 1 decimal place.) O Answer is complete but not entirely correct. Shortfal 100% f. What are break-even sales at this point? (Round your answer to nearest whole number) Answer is complete and correct. 91,500 Break-even sales Step by Step Solution
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