Use the Below Information to Answer the Following Question Refer to the Table

question 3

Multiple Choice

Use the below information to answer the following question.
$\begin{array}{lr}\text { Sales }(100,000 \text { units }) & \$ 1,000,000 \\\text { Variable costs } & 300,000\\\text { Contribution margin } & 700,000 \\\text { Fixed manufacturing costs } & 200,000\\\text { Operating income } & 500,000 \\\text { Interest } & 75,000\\\text { Earnings before taxes } & 425,000 \\\text { Taxes }(30 \%) & 127,500\\\text { Net income }&\$297,500\end{array}$
Refer to the table. The degree of combined leverage is ________.

• A) 2.22x
• B) 1.90x
• C) 2.95x
• D) 1.65x

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Definitions:

Temperature Control

the process of monitoring and adjusting temperatures to maintain a desired level, important in various scientific and industrial processes as well as in preserving food.

Blood Cells

Blood cells are the cells found in the blood, comprising mainly red blood cells (erythrocytes), white blood cells (leukocytes), and platelets (thrombocytes), each serving various functions within the body.

Vertebra

One of the small bones forming the backbone, providing support and protecting the spinal cord.

Transverse Processes

Projections on vertebrae where muscles and ligaments attach, part of the bone's anatomy.