Healthy Foods Inc. sells 50-pound bags of grapes to the military for $10 a bag. The fixed costs of this operation are $92,000, while the variable costs of grapes are $0.10 per pound. a. What is the break-even point in bags? (Round your answer to 2 decimal places.)
Break-even point bags
b. Calculate the profit or loss (EBIT) on 14,000 bags and on 33,000 bags. (Input all amounts as positive values. Round your answers to the nearest whole number.)
Bags Profit/Loss Amount
14,000 (Click to select)LossProfit $
33,000 (Click to select)ProfitLoss $
c. What is the degree of operating leverage at 22,000 bags and at 33,000 bags? (Round your answers to 2 decimal places.)
Bags Degree of
Operating Leverage
22,000
33,000
d. If Healthy Foods has an annual interest expense of $9,000, calculate the degree of financial leverage at both 22,000 and 33,000 bags. (Round your answers to 2 decimal places.)
Bags Degree of
Financial Leverage
22,000
33,000
e. What is the degree of combined leverage at both 22,000 and 33,000 bags? (Round your answers to 2 decimal places.)
Bags Degree of
Combined Leverage
22,000
33,000