Based on the following information, fill the information in the given below Income statement of a Company The company expects to sell 3000 units in the current year and the price per unit is 10 OMR. The variable cost per unit of the company is 4 OMR and the fixed cost is 6000 OMR. In the next year company expects to sell 6000 units. Calculate EBIT for the current year and the next year. The company also has a $30,000 bond with a 10% annual coupon rate and an issue of 500 shares of $4 annual dividend preferred stock. It also has 1,000 share of common stock outstanding. The tax rate for the Company is 40%. Fill out the given below Income statement and calculate the Degree of operating leverage Degree of Financial leverage Degree of Total leverage. YEAR 1 YEAR 2 Sales Quantity 3000 6000 Sales Revenue (in OMR)(selling
Based on the following information, fill the information in the given below Income statement of a Company The company expects to sell 3000 units in the current year and the price per unit is 10 OMR. The variable cost per unit of the company is 4 OMR and the fixed cost is 6000 OMR. In the next year company expects to sell 6000 units. Calculate EBIT for the current year and the next year. The company also has a $30,000 bond with a 10% annual coupon rate and an issue of 500 shares of $4 annual dividend preferred stock. It also has 1,000 share of common stock outstanding. The tax rate for the Company is 40%. Fill out the given below Income statement and calculate the Degree of operating leverage Degree of Financial leverage Degree of Total leverage. YEAR 1 YEAR 2 Sales Quantity 3000 6000 Sales Revenue (in OMR)(selling
Chapter4: Financial Planning And Forecasting
Section: Chapter Questions
Problem 7P
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Based on the following information, fill the information in the given below Income statement of a Company
The company expects to sell 3000 units in the current year and the price per unit is 10 OMR.
The variable cost per unit of the company is 4 OMR and the fixed cost is 6000 OMR.
In the next year company expects to sell 6000 units.
Calculate EBIT for the current year and the next year.
The company also has a $30,000 bond with a 10% annual coupon rate and an issue of 500 shares of $4 annual dividend preferred stock . It also has 1,000 share of common stock outstanding. The tax rate for the Company is 40%.
Fill out the given below Income statement and calculate the
Degree of operating leverage
Degree of Financial leverage
Degree of Total leverage.
YEAR 1
YEAR 2
Sales Quantity
3000
6000
Sales Revenue (in OMR)(selling price per unit is 10 OMR)
Less: Variable operating costs( VC per unit is 4 OMR)
Less: Fixed operating costs
Earnings before interest and taxes (EBIT)
Less: Interest
Net profit before tax
Less: Tax (40%)
Less: Preferred stock dividend
Earnings available for common shareholders
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