A project has fixed costs of $1,000 per year, depreciation charges of $500 a year, revenue of $6,000 a year, and variabl
-
answerhappygod
- Site Admin
- Posts: 899603
- Joined: Mon Aug 02, 2021 8:13 am
A project has fixed costs of $1,000 per year, depreciation charges of $500 a year, revenue of $6,000 a year, and variabl
A project has fixed costs of $1,000 per year, depreciation charges of$500 a year, revenue of $6,000 a year, and variable costs equal totwo-thirds of revenues. a. If sales increase by 5 percent, what will be the increase in pretaxprofits?b. What is the degree of operating leverage of this project?c. Confirm that the percentage change in profits equals DOL times thepercentage change in sales.