We write, we don’t plagiarise! Every answer is different no matter how many orders we get for the same assignment. Your answer will be 100% plagiarism-free, custom written, unique and different from every other student.
I agree to receive phone calls from you at night in case of emergency
Please share your assignment brief and supporting material (if any) via email here at: [email protected] after completing this order process.
No Plagiarism Guarantee - 100% Custom Written
The following data applies to a manufacturing company:
Actual production and sales of a company is 3,000 units
Selling price is £30 per unit
Variable cost is £15 per unit
The company is considering two different capital structures G and U. The company also has two different production scenarios where fixed costs differ. In Scenario I fixed costs are £15,000 whereas in Scenario 2 the fixed costs are £20,000.
The capital structure is as follows:
Capital Structure G
Capital Structure U
Equity
£10,000
£ 15,000
Debt (Interest rate 20%)
£ 5,000
Total Capital
£20,000
£ 20,000
Calculate:
(a) Operating leverage
(b) Financial leverage
Ignore the effect of taxation.
