From the information provided in the table  (i) Calculate EBIT, Fixed Cost, Variable cost and Profit after tax for Company A and S as per financial data given below.  (ii) Comment on the Operating and Financial risk for both the firms. Give reasons for your answer.  Particulars A S Variable Expenses as a percentage of sales 75% 50% Interest Expense in Amount Rs. 300 1000 Degree of Operating Leverage 6 2 Degree of Financial Leverage 4 2 Income Tax Rate 35% 35%

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Production Budget

A budget can be defined as a financial plan designed by an undertaking for a definite period in the future that can contribute towards enhancing the financial success of the business undertaking. It is used to estimate the revenue and expenses. The budget generally takes into account both current and future income and expenses.