Compute pinchess dol dfl and dcl

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Reference no: EM13927377

Pinches Salt Company has the following income statement for 2010:

Sales

$5,000,000

Variable operating costs

1,000,000

Fixed operating costs

2,000,000

EBIT

$2,000,000

Interest

500,000

EBT

$1,500,000

Tax (at 40%)

600,000

EAT

$900,000

Preferred dividends

100,000

Earnings available to common stockholders

 $800,000

Shares outstanding

400,000

a. Compute Pinches's DOL, DFL, and DCL.

b. If sales increase to $5,500,000, what is your forecast of EPS?

Reference no: EM13927377

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