Revision Leverage & Dividend policy Question 1 ACME Berhad reported the following income statement for 2019: Sales $2,500,000 Variable Costs 900,000 Fixed Operating Costs 700,000 EBIT 900,000 Interest Expense 200,000 EBT 700,000 Taxes (30%) 210,000 Net Income $490,000 Earnings Per Share $9.80 Required: a) What is the BEP(RM) for Acme Berhad? b) Calculate the degree of operating leverage, the degree of financial leverage and the combined leverage for Acme Berhad. c) If sales decrease by 10%, what will be the impact to EBIT? d) If EBIT increase by 15%, what will be the percentage increase in EPS? If sales increase by 25%, what will be the new level of Acme Berhad's EPS