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QUESTION 6 a) The following data is available for Firm A Firm A Quantity Selling price Variable cost Fixed costs Interest Preferred dividend Tax rate
QUESTION 6
a) The following data is available for Firm A
Firm A
Quantity
Selling price
Variable cost
Fixed costs
Interest
Preferred dividend
Tax rate
20,000 units
$. 20
$. 15
$. 40,000
$. 10,000
$. 5,000
30%
Required:
i. Overall break - even point in units.
ii. Degree of operating leverage.
iii. Degree of financial leverage.
iv. Degree of total leverage.
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