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The revenue of a company is 10 Million. The Contribution Margin is 50% of Revenue and Fixed expenses are Rs. 2 Million. Amount of fixed
The revenue of a company is 10 Million. The Contribution Margin is 50% of Revenue and Fixed expenses are Rs. 2 Million. Amount of fixed Interest amount is 0.5 Million and Tax rate is 30%.
a. You are required to calculate Operating & Financial Leverages.
b. How these leverages are linked with revenue and profitability of the company? And how leverage plays crucial role in future financial planning?
a. You are required to calculate Operating & Financial Leverages.
b. How these leverages are linked with revenue and profitability of the company? And how leverage plays crucial role in future financial planning?
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Step: 1
a To calculate the operating leverage we need to use the contribution margin CM and the fixed expenses FE The formula for operating leverage is Operat...
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Income Tax Fundamentals 2013
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
31st Edition
1111972516, 978-1285586618, 1285586611, 978-1285613109, 978-1111972516
