If United Snack Company has an annual interest of
$18,000. calculate the degree of financial leverage...
If United Snack Company has an annual interest of
$18,000. calculate the degree of financial leverage at 20,000 and
25,000 bags. with a cost of $26 per bag. 50lb bags at $0.18 per bag
variable cost and $244 800 fixed cost of operation.
Solutions
Expert Solution
THERE IS A ERROR IN WRITING VARIABLE COST = IT IS PER lb
AND NOT PER bag
If the United Snack shop Company has an annual
interest of 18,000. calulate the degree of financial leverage at
both 20,000 and 25,000 bags
20,000 bags and 25,000 bags interest $18,000.
operation $244,800 50lb bags of peanuts at $0.18 per pound
what is the degree leverage per 20,000 bags?
Calculate the degree of operating leverage, degree of financial leverage, and degree of total operating leverage given: Revenue grows from $200 to $230 EBIT grows from $50 to $60 NI grows from $20 to $28
Terrible Clips has a degree of financial leverage of 2.45 and a
degree of combined leverage of 9.32. What percentage change will a
25 percent increase in sales have on EBIT?
At an output level of 18,000 units, you have calculated that the
degree of operating leverage is 2.10. The operating cash flow is
$46,500 in this case. Ignore the effect of taxes.
a. What are fixed costs? (Do not round intermediate calculations
and round your answer to the nearest whole number, e.g., 32.)
b. What will the operating cash flow be if output rises to
19,000 units? (Do not round intermediate calculations and round
your answer to 2 decimal places,...
The Sosa Company produces baseball gloves with a degree of
financial leverage of 1.66 based on the company’s income statement
for 2004. What does that mean in its company's risk?
Degree of financial leverage Northwestern Savings and Loan has
a current capital structure consisting of $ 220 comma 000 of 15 %
(annual interest) debt and 3 comma 000 shares of common stock. The
firm pays taxes at the rate of 25 %. a. Using EBIT values of $ 81
comma 000 and $ 122 comma 000, determine the associated earnings
per share (EPS). b. Using $ 81 comma 000 of EBIT as a base,
calculate the degree of financial...
Degree of financial leverage - Northwestern Savings and Loan has
a current capital structure consisting of $ 250,000 of 15 %
?(annual interest) debt and 3,000 shares of common stock. The firm
pays taxes at the rate of 40 %.
a. Using EBIT values of $ 76,000 and $116,000?, determine the
associated earnings per share? (EPS).
b. Using $76,000 of EBIT as a? base, calculate the degree of
financial leverage? (DFL).
c. Rework parts a and b assuming that the...
Degree of financial leverage Northwestern Savings and Loan has
a current capital structure consisting of $ 220 comma 000 of 14 %
(annual interest) debt and 3 comma 000 shares of common stock. The
firm pays taxes at the rate of 40 %. a. Using EBIT values of $ 79
comma 000 and $ 117 comma 000, determine the associated earnings
per share (EPS). b. Using $ 79 comma 000 of EBIT as a base,
calculate the degree of financial...
At an output level of 62,000 units, you calculate that the
degree of operating leverage is 3.70. Suppose fixed costs are
$280,000. What is the operating cash flow at 56,000 units? (Do not
round intermediate calculations and round your final answer to the
nearest whole number, e.g., 32.) Operating cash flow $ What is the
new degree of operating leverage? (Do not round intermediate
calculations and round your final answer to 3 decimal places, e.g.,
32.161.) Degree of operating leverage
At an output level of 45,000 units, you calculate that the
degree of operating leverage is 2.79. Fixed costs are $175,000.
a. What is the operating cash flow at 43,000 units? (Do not
round intermediate calculations and round your answer to the
nearest whole number, e.g., 32.)
b. What is the degree of operating leverage? (Do not round
intermediate calculations and round your answer to 3 decimal
places, e.g., 32.161.)