Problemthe poseidon swim company produces swim trunks the, Ask an Expert

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Problem:

The Poseidon Swim Company produces swim trunks. The average selling price for one of their swim trunks is $38. The variable cost per unit is $25, Poseidon Swim has average fixed costs per year of $35,194.

Required:

Assume that current level of sales is 5,328 units. What will be the resulting percentage change in EBIT if they expect units sold to be increased by 4 percent? (You should first calculate the degree of operating leverage)

Elucidate comprehensively and show all calculation.

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Basic Finance, Finance

Category:- Basic Finance
Reference No.:- M91147341

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