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Using the following data, determine the following for each firm: a. Break even points in terms of units b. Margin of Safety c. Operating Leverage
Using the following data, determine the following for each firm: a. Break even points in terms of units b. Margin of Safety c. Operating Leverage KAT, Inc Tax Rate 22% Units Sold 11,000 Sales $1,320,000 Variable Costs $780,000 Contribution M $540,000 Fixed Costs $340,000 Operating Income $200,000 DAWG, Inc 26% 11,000 $1,320,000 $940,000 $380,000 $180,000 $200,000 d. Determine number of units to be sold to reach a profit of $413,000 e. Explain why one firm must sell more units to reach the $413,000 target profit despite having a lower break-even point
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