Calculate megastructure degree of combined leverage

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Reference no: EM13292365

The Megastructure Airplane Company has the following modified income statement (RM 000) at 150,000 units of production.

RM
Revenues 10,000
Variable costs 6,500
Fixed costs 2,200
EBIT 1,300
Interest at 10% 500
EBT 800
Tax 35% 320
EAT 480
Number of shares 20,000

i) What is Megastructure's contribution margin?
ii) What is Megastructure's dollar break-even point?
iii) Calculate Megastructure's degree of financial leverage (DFL).
iv) Calculate Megastructure's degree of operating leverage (DOL).
v) Calculate Megastructure's degree of combined leverage (DCL).

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