Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Please use the following information and income statement for Protection Corp for the year ended December 31, 2019 to answer the questions below: Sales revenues

image text in transcribedimage text in transcribed

Please use the following information and income statement for Protection Corp for the year ended December 31, 2019 to answer the questions below: Sales revenues $150,000 Variable cost of sales (112,500) Gross profit 37,500 Fixed operating costs (24,000) Net operating income 13,500 (EBIT) Interest (10,000) Earnings before taxes 3,500 Taxes (40%) (1,400) Net income 2,100 If there is a 4% decrease in EBIT, what is the resulting change in EPS? 15.44 % decrease - What is the Degree of Total Leverage (DTL)? 10.73 What does this value mean? x indicates that if Sales change by 1 percent, EPS will change by 10.73%. If there is 3% increase in sales, what is the resulting change in EPS? 32.19 % increase What is the Sales Operating Break Even Point? $ What is the Quantity Operating Break Even Point? units

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Financial Management Principles And Practices

Authors: Sudhindra Bhat

2nd Edition

8174465863, 978-8174465863

More Books

Students also viewed these Finance questions

Question

how to conquer your premitive brain

Answered: 1 week ago

Question

Summarize the impact of a termination on the employee.

Answered: 1 week ago