Interpret the meaning of the dol, Corporate Finance

Company X produces tea kettles, which it sells for $12 each. Fixed costs are $650,000 for up to 400,000 units of output. Variable costs are $8 per kettle.

a. What is the breakeven point?

b. What is Company X's degree of operating leverage at a sales level of 200,000 units?  Interpret the meaning of the DOL?

c. If sales increase by 10%, how much will EBIT change?

Posted Date: 2/28/2013 4:54:58 AM | Location : United States

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