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QUESTION 1 - DOL/MOS (10 marks) Income statements for two different companies are as follows: Required: 1. Calculate the margin of safety in dollars for

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QUESTION 1 - DOL/MOS (10 marks) Income statements for two different companies are as follows: Required: 1. Calculate the margin of safety in dollars for each firm. ( 2 marks) 2. Determine the degree of operating leverage for each firm. (2 marks) 3. Determine the operating income for each firm if sales increase by 20%. ( 2 marks) 4. Provide valuable comments to management on the differences between the two firms. (4 marks)

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