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Chapter 10b - Chapter 10b 1 Pirates Inc has an EBT of $190...

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Chapter 10b 1. Pirates Inc. has an EBT of $190 and Interest Expense of $10. What is the Pirates Inc’s DFL? 2. Assuming Pirates has a DOL of 2.3 and a revenue increase in 3%, how much of an increase will occur in Net Income? 3. Rush Inc. recently released the Following data(use to answer 3-6): Sales $15,000,000 COGS $9,000,000 Operating Expenses $2,000,000 Interest Expense $1,300,000 Tax Rate 34% What will Rush's increase in EBIT be if Sales increase by 1.5%? 4. What will Rush’s resulting increase in NI be? 5. What is Rush’s DCL? 6. Assume Rush Inc. projected a 3.5% increase in sales and had a DCL of 1.9. What would the projected Net Income be under these circumstances? 7. ALT Co. has $250 in annual fixed costs and $0.30 variable cost per unit. If each unit is sold for $1.15, what is the ALT’s breakeven point? 8. Which of the following is NOT a type of operating leverage? a. Property Tax b. Rent c. Preferred Stock d. Administrative Salaries 9. Abdul Inc. discovers it will reach break-even point if it sells 12345 units. If its unit contribution margin is $1.87, what is Abdul Inc’s total fixed cost? 10. Tucano Company recently reported the following data: Sales 180000 0 Variable Costs 500000 Fixed Cost
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