Use the Information Below to Answer the Following Question(s)

question 149

Multiple Choice

Use the information below to answer the following question(s) .
Hartville Kitchens has a monthly target operating income of $18,000. Variable expenses are 25% of sales and monthly fixed expenses are $12,000.
-What is Hartville Kitchens' operating leverage factor at the target level of operating income?

• A) 2.50
• B) 1.67
• C) 0.33
• D) 0.60

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Definitions:

Semiannual Coupon

A bond or other fixed-income security that pays interest to the holder every six months.

Interest Rate

The price, in terms of a percentage of the principal, that a borrower needs to pay a lender to utilize their financial resources.

Bond's Price

The market price for which a bond is bought or sold, influenced by factors like interest rates, the bond's credit quality, and its maturity date.

Market Value Basis

The valuation of assets or securities based on the current market prices as opposed to historical costs or theoretical values.