Question
With my company's financial data given above, (fixed costs @ $20,000, variable costs @ $16/unit and sale price @ $28/unit), if I sold 3,000 units
With my company's financial data given above, (fixed costs @ $20,000, variable costs @ $16/unit and sale price @ $28/unit), if I sold 3,000 units in 2019 and expect to sell 3,300 units this year (2020) under those same financial costs.
a.Calculate the % change in my operating income and compare it with my % change in sales
b.Calculate the degree of Operating leverage (DOL) for:
i.2019
ii.2020
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Modern Portfolio Theory and Investment Analysis
Authors: Edwin Elton, Martin Gruber, Stephen Brown, William Goetzmann
9th edition
9781118805800, 1118469941, 1118805801, 978-1118469941
