Question: The Capital structure of ABC Ltd, is as under: Equity share capital 100 Lacs 10% Debentures 50 Lacs The sales for the

The Capital structure of ABC Ltd, is as under:

Equity share capital	₹ 100 Lacs
10% Debentures	₹ 50 Lacs

 The sales for the year 2019 are 1.5 Lac units@ ₹ 40per unit

 Also, the variable cost per unit is 20 % of sales revenue

 ₹ 12 Lacs is the fixed operating cost.

 Assume Income tax rate as 40 %

Calculate Operating, Financial and Combined Leverage of the firm and interpret the result.

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