If a company had total sales of $1,000, total variable costs of $400, total fixed costs...
If a company had total sales of $1,000, total variable costs of $400, total fixed costs of $300, and total interest expenses of $100, then the Degree of Financial Leverage would be __.__. Round your answer to 2 decimal places.
Homework Answers
Degree of Financial Leverage = EBIT/(EBIT - Interest)
EBIT = sales - variable costs - fixed costs
= 1000-400-300
= 300
DFL = 300/(300-100)
= 300/200
= 1.5
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