A Bristal Boats,Inc

question 127

Multiple Choice

A Bristal Boats,Inc.reports sales of $4,000,000,variable costs of $500,000,fixed operating costs of $1,250,000,and interest expense of $350,000.The corporation's EBIT is $3,250,000 and its marginal tax rate is 30%.If the corporation is able to increase its sales by 25%,then

• A)its EBIT will increase by 25% and its EPS will increase by 25%.
• B)its EBIT will increase by more than 25% and its EPS will increase by less than 25%.
• C)its EBIT and EPS will both increase,but less than 25% due to fixed costs and taxes.
• D)its EBIT will increase by more than 25% and its EPS will increase by more than the percentage increase in EBIT.

---

Definitions:

Schematic Technique

A method using schematics or diagrams to represent the elements and structure of a system or process.

Defective Parts

Components or units that fail to meet quality standards or specifications, impacting product performance and customer satisfaction.

Quality Definitions

These are the criteria or standards used to measure the level of excellence, fitness for purpose, or compliance of a product or service.