United Snack Company sells 50-pound bags of peanuts to university dormitories for $5 a bag. The fixed costs of this operation are $60,000, while the variable costs of peanuts are $.5 per pound.

a. What is the break-even point in bags?

b. Calculate the profit or loss on 18,000 bags .

c. What is the degree of operating leverage at 20,000 bags ?

d. If United Snack Company has an annual interest expense of $10,000, and EBIT $80.000 , calculate the degree of financial leverage at 18,000 .

e. What is the degree of combined leverage at both sales level