You are provided with the following financial statements that reflect previous period of company operations.

Sales $ 15,000,000

Variable Costs $ 7,000,000

Fixed Costs $ 3,000,000

EBIT $ 5,000,000

Interest Expense $ 1,000,000

EBT $ 4,000,000

Tax (0.50) $ 2,000,000

Net Income $ 2,000,000

a. At this level of output, what are the degrees of operating leverage?

b. What are the degrees of financial leverage?

c. What are the degrees of leverage in the combination?

d. If sales increase by 20%, how much percentage will impact EBT (and net income)?

e. What is the breakeven point from this problem