What are some sources of operating and financial leverage

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Reference no: EM131020817

1. Smith Company and Jones Company each sell 12,000 bottles at $ 3.00 per bottle. Production costs are $9,000 fixed costs plus $1 per bottle. Calculate the operating income (EBIT) for both companies.

2. Using the information in Exercise 1, calculate the earnings after interest for each company.

3. What are some sources of operating and financial leverage?

Reference no: EM131020817

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