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QUESTION 3 a. a) Sutera Business Sdn Bhd has recorded sales of 250,000 units at RM12 in the financial year 2022. The operating costs
QUESTION 3 a. a) Sutera Business Sdn Bhd has recorded sales of 250,000 units at RM12 in the financial year 2022. The operating costs of Sutera Business Sdn Bhd are as follows: Operating Variable cost Fixed Operating cost RM4.00/per unit RM750,000 During the period, Sutera Business Sdn Bhd paid a loan interest of RM125000. The equity of Sutera Business Sdn Bhd is shown below: 5000 units of preferred shares with annual dividend of RM5/unit. 15000 ordinary shares issued. Earnings are subject to a tax of 28 percent. As per the above information, you are required to: i) Calculate the BEP in units and RM for Sutera Business Sdn Bhd. (5 Marks) (3 Marks) (3 Marks) (3 Marks) (3 Marks) ii) Calculate the Earnings per share at the current sales level iii) Calculate the earnings per share if sales increase by 10% iv) Calculate the Degree of Operating Leverage at current sales level. v) Calculate the Degree of Financial Leverage at current sales level. vi) Calculate the Degree of Total Leverage at current sales level. (3 Marks) b. Azam Berhad is a home improvement retailer. The company financial structure as follow where the company have a short-term debt of RM400000; account payable RM100000; long term debt RM2000000 and owners' equity of RM1500000. Calculate the interest- bearing debt ratio of Azam Berhad for their present capital structure. (5 Marks)
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