22 PQR Manufacturing Corporation has $2,500,000 in debt outstanding. The company's before-tax cost of debt...
60.1K
Verified Solution
Link Copied!
Question
Finance
22 PQR Manufacturing Corporation has $2,500,000 in debt outstanding. The company's before-tax cost of debt is 10%. Sales for the year totaled $4,200,000 and variable costs were 52% of sales. Net income was equal to $790,000 and the company's tax rate was 30%. If PQR's degree of total leverage is equal to 1.30, what is its degree of operating leverage? Do not round intermediate calculations. a. 1.5358 b. 1.5880 c. 1.0642 d. 0.9100 e. 1.1004.
Answer & Explanation
Solved by verified expert
Get Answers to Unlimited Questions
Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!
Membership Benefits:
Unlimited Question Access with detailed Answers
Zin AI - 3 Million Words
10 Dall-E 3 Images
20 Plot Generations
Conversation with Dialogue Memory
No Ads, Ever!
Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
