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20100 points Consider a four-year project with the following information: initial fixed asset investment $590,000; straight-line depreciation to zero over the four-year life, zero salvage value; price $34, variable costs- $26, fixed costs $230,000, quantity sold 89,000 units; tax rate 35 percent. What is the degree of operating leverage at the given level of output? (Do not round intermediate calculations. Round your answer to 4 decimal places, e.g., 32.1616.) Degree of operating leverage What is the degree of operating leverage at the accounting break-even level of output? (Do not round intermediate calculations. Round your answer to 4 decimal places, e.g., 32.1616,) Degree of operating leverage References eBook & Resources Learning Objective: 11-04 How the degree of operating leverage can affect the cash flows of a project Worksheet
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File Home nert Page Layout Formulas Data Review View dd-Ins Cut Σ AutoSum Calibri ー E ゴWrap Text General aCopy в 1 프 . Ej-., Δ. : rーー 逻锂函Merge & Center. $, % , 弼,8 C Paste Conditional Format CeInsert Delete Format Formatting, as Table w styles. ▼ ㆆ ▼ Sort &Find & 2 ClearFe Select Edting Format Painter Clipboard HN25 HI Font Alignment Number Styles Cells HJ HK HL HM HN HO HP HQ HR HS HT HU HV 18 19 20 21 SALES VARIABLE COSTS CONTRIBUTION FIXED COSTS DEPRECIATION EBT TAX NET INCOME DEPRECIATION OPERATING CASH FLOW 3026000 89000 34 2314000 89000 *26 23 24 25 26 27 28 29 30 31 32 ANS1 OPERATING LEVERAGE AT 89000 UNITS 712000 230000 147500 334500 117075 217425 147500 364925 DEPRECIATION 147500 590000/4 1.6303 1 FIXED/ OPERATING CASHF FLOW 34 ANS 2 35 36 OPERATING LEVERAGE AT ACCOUNTING BREAK EVEN LEVEL = 2.5593 1FIXED COST/DEPRECIATION (BECAUSE AT ACCOUNTING BREAKEVEN OPERATING CASH FLOW DEPRECIATION) | FIFO . CASH BUDGET 45 BV MV ratio VARIANCE BEP, OL FL ratos B-S loss SALES BUDGET DIFF ANALYSIS overheadfloat 01:47 02-02-2019

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