If EBIT Equals $140,000 and Interest Equals $21,000,with a Tax

question 83

Multiple Choice

If EBIT equals $140,000 and interest equals $21,000,with a tax rate of 31%,what is the degree of financial leverage?

• A) 6.67x
• B) 5.67x
• C) 3.91x
• D) 1.18x

---

Definitions:

Expressed Emotion

A measure of the family environment based on how much criticism, hostility, and emotional overinvolvement are directed towards a family member, usually one with a psychiatric disorder.

Genetic Factors

Elements within an organism's genes that influence its traits and characteristics, potentially affecting its health, behavior, and physical appearance.

Personality Disorder

A mental disorder defined by persistent unhealthy patterns in behavior, thought processes, and personal feelings that unfold in various situations and significantly diverge from what is considered normal by the individual's cultural standards.

Antisocial

Behavior that goes against social norms, often harming others or lacking consideration for their well-being.