-The Degree of Financial Leverage Is:
A) 1

question 35

Multiple Choice

$$\begin{array} { l r } \text { Sales } ( 100,000 \text { units) } & \$ 1,000,000 \\\text { Variable costs } & \underline { 300,000 } \\\text { Contribution margin } & 700,000 \\\text { Fixed manufacturing costs } & \underline { 250,000 } \\\text { Operating income } & 450,000 \\\text { Interest } & \underline { 60,000 } \\\text { Earnings before taxes } & 390,000 \\\text { Taxes (at } 31 \% \text { ) } & \underline { 120,900 } \\\text { Net Income } & \underline { \$ 269,100 } \\\text { Shares outstanding } & 10,000\end{array}$$
-The Degree of Financial Leverage is:

• A) 1.56x.
• B) 1.79x.
• C) 7.50x.
• D) 1.15x.

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Definitions:

Internet Access

The ability to connect to the internet to send and receive data.

Coffee Shop

A small, informal establishment serving coffee, tea, and sometimes light refreshments or meals.

Flextime

is a flexible working hours policy that allows employees to choose their start and end times, within agreed limits.

Required Hours

The specific number of hours an individual is expected to work as determined by an employment contract or agreement.