Kulwicki Corporation Wants to Determine the Effect of an Expansion

question 24

Multiple Choice

Kulwicki Corporation wants to determine the effect of an expansion of its sales on its operating income (EBIT) . The firm's current degree of operating leverage is 2.50. It projects new unit sales to be 170,000, an increase of 45,000 over last year's level of 125,000 units. Last year's EBIT was $60,000. Based on a degree of operating leverage of 2.5, what is this year's expected EBIT with the increase in sales?

• A) $108,300
• B) $ 97,741
• C) $ 92,854
• D) $102,885
• E) $114,000

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Definitions:

Dopamine

A neurotransmitter involved in the reward and pleasure centers of the brain, influencing movement, learning, attention, and emotional responses.

Frontal Lobes

Areas of the brain located in the front and top, responsible for higher mental processes and decision making as well as the production of fluent speech.

Basic Types of Neurons

Refers to the fundamental categories of nerve cells in the nervous system, including sensory neurons, motor neurons, and interneurons, each with specific functions.

Sensory Neurons

Nerve cells responsible for converting external stimuli from the environment into internal electrical impulses for the brain to interpret.