Problem #1 (22 marks) You have developed the following income statement for your corporation which represents the most recent year's operations which ended yesterday. Sales $45,750,000 Variable Costs -22,800,000 Gross Profit $22,950,000 Fixed Costs -9,200,000 Depreciation -4,000,000 EBIT $9,750,000 Interest -1,350,000 EBT $8,400,000 Tax 40% -3,360,000 Net Income $5,040,000 Shares Outstanding 2,000,000 EPS =Net income / # shares $2.52 Your supervisor in the controller's office just handed you a memo asking for written responses to the following questions. a. Calculate the degree of operating leverage for the firm. (2 marks). Please round your final answer to 2 decimals. b. Calculate the degree of financial leverage for the firm. (2 marks). Please round your final answer to 2 decimals. c. Calculate the degree of combined leverage for the firm. (2 marks). Please round your final answer to 2 decimals. d. If the company is able to increase their sales by 25%, what percentage increase in EBIT would you expect to observe? (2 marks)