. If Healthy Foods has an annual interest expense of \$10,000, calculate the
degree of financial leverage at both 20,000 and 25,000 bags.

20,000 bags x \$10 = 200,000 - \$10,000 = 190,000 – 80,000 = 110,000
25,000 bags x \$10 = 250,000 - \$10,000 = 240,000 – 80,000 = 160,000

e. What is the degree of combined leverage at both sales levels?

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1. How is 80,000÷2,000 diffferent from the quotient 80,000÷200or80,000÷20

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posted by jamaria

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