Clockworks Co. reports the following data for the current year:
Units sold………………………………………… 1,200
Unit sales price…………………………………… $30
Unit variable cost………………………………… $10
Total fixed cost…………………………………… $18,000
Required:
(a) Calculate Clockworks' pretax income.
(b) Calculate Clockworks' degree of operating leverage.

Question

Quizplus · Accepted Answer

The Answer of Clockworks Co. reports the following data for the current year:
Units sold………………………………………… 1,200
Unit sales price…………………………………… $30
Unit variable cost………………………………… $10
Total fixed cost…………………………………… $18,000
Required:
(a) Calculate Clockworks' pretax income.
(b) Calculate Clockworks' degree of operating leverage.