# Team D - Group Project - Accounting 220 Finance The project...

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Company Basics and Financial Ratios – Part 2 Question 1 Using the most recent three years of available data, compute Wal-Mart’s and Target’s degree of operating leverage. You will have to use the formula, percentage change in pretax income divided by percentage change in revenues. Show your work. DOL = Percent change in Pre-Tax Income / Percent change in Revenue Walmart Percent change in Pre-Tax Income = (Operating income 2009 – Operating income 2008) / Operating income 2008 = (\$22,118 – \$20,867) / \$22,118 = 5.66% Walmart Percent change in Revenue = (Revenue 2009 – Revenue 2008) / Revenue 2009 = (\$408,085 – \$404,254) / \$408,085 = .94% Walmart DOL (2008-2009) = 5.66% / .94% =
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## This note was uploaded on 09/10/2011 for the course ACCOUNTING IS 160 taught by Professor Taylor during the Spring '11 term at Herzing.

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Team D - Group Project - Accounting 220 Finance The project...

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