Dec
2
albatross airlines fixed operating costs are $5-8 million and its variable cost ratio is 0.20. The firm has?
Filed Under Other - Business & Finance
jes asked:
… $2million in bonds outstanding with a coupon rate interest rate of 8 percent. Albatross has 30,000 shares of preffered stock outstanding which pays a $2 annual dividend. there are 100,000 shares of common stock outstanding. revenues for the firm are $8 million and the firm is in the 40% corporate income tax bracket.
… $2million in bonds outstanding with a coupon rate interest rate of 8 percent. Albatross has 30,000 shares of preffered stock outstanding which pays a $2 annual dividend. there are 100,000 shares of common stock outstanding. revenues for the firm are $8 million and the firm is in the 40% corporate income tax bracket.
compute albatross’ degree of operating leverage, compute its degree of financial leverage, compute its degree of combined leverage and interpret this value.
MERRILL
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more homework. sorry but that is over my head.