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Degree of operating leverage ??Grey Products has fixed operating costs of $390,000?, variable operating costs of...

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Finance

Degree of operating leverage ??Grey Products has fixed operatingcosts of $390,000?, variable operating costs of $16.06

per? unit, and a selling price of $63.54 per unit.

a. Calculate the operating breakeven point in units.

b. Calculate the? firm's EBIT at 11,000?, 13,000?, and 15,000?units, respectively.

c. With 13,000 units as a? base, what are the percentage changesin units sold and EBIT as sales move from the base to the othersales levels used in part ?(b?)?

d. Use the percentages computed in part (c?) to determine thedegree of operating leverage? (DOL).

e. Use the formula for degree of operating leverage to determinethe DOL at 13,000 units.

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