Last Year Alpine Growers Experienced a 34% Increase in Earnings

question 37

Multiple Choice

Last year Alpine Growers experienced a 34% increase in earnings per share on 11% increase in sales. If management knows that Alpine's DOL is 1.5, what is its DFL?

• A) 3.09
• B) 2.06
• C) 3.55
• D) 1.67

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Definitions:

Offset Side

The side of a transaction that counterbalances the primary entry, ensuring the accounting equation remains balanced.

Increase Side

The side of an account on which increases are recorded, depending on the type of account it could be the debit or credit side.

Right Side

In accounting, refers to the credit side of a ledger account, opposite to the left or debit side, showcasing the sources of funds or increases in liabilities or equity.

Decrease Side

The side of an accounting equation or ledger where decreases in assets, expenses, or dividends are recorded, often the credit side for assets and the debit side for liabilities and equity.