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Homework 7C

Homework 7C

Q 1.La Cucaracha Pest Control, Inc. is reviewing its financial condition. The firm's operating leverage is 2.97. The firm’s financial leverage was of 2.43. What is the firm’s degree of combined (total) leverage of La Cucaracha Pest Control, Inc. ? 2.Haunted Forest, Inc.is selling fog machines. Use the following information about Haunted Forest, Inc. to answer the following questions. Average selling price per unit $311. Variable cost per unit $209 Units sold 397 Fixed costs $15,788 Interest expense $3,585 Based on the data above, what is the degree of total (combined) leverage of Haunted Forest, Inc.? Round the answer to two decimals 3.Haunted Forest, Inc.is selling fog machines. Use the following information about Haunted Forest, Inc. to answer the following questions. Average selling price per unit $325. Variable cost per unit $216 Units sold 360 Fixed costs $17,357 Interest expense $3,848 Based on the data above, what will be the resulting percentage change in earnings per share if they expect units produced and sold to change -1.9 percent? (You should calculate the degree of total (combined) leverage first). (Write the percentage sign in the "units" box). Round the answer to two decimals

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1. 7.22 2. 1.92