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tractors must be sold. 2. Pinches Salt Company has the following income statement: (10 points) (5 points for part A and 5 points for part
tractors must be sold. 2. Pinches Salt Company has the following income statement: (10 points) (5 points for part A and 5 points for part B.) Sales Variable Operating Cost Fixed Operating Cost EBIT Interest EBT Tax (at 40%) EAT Preferred Dividends Earnings available for CS $5,000,000 1,000,000 2.000.000 $2,000,000 500,000 $1,500,000 600.000 $ 900.000 100,000 $ 800,000 400,000 Shares Outstanding a. Compute Pinches DOL, DFL, and DTL b. If sales increase to $5,500,000, what is the forecast of the EPS. You need to make a new income statement to complete this problem. ** You will need this formula to complete this problem** Here it is: DOL at base $ sales TR is TR-TVC/TR-TVC-FC 10 million. Fixed operating cost is $5
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