Given the following financial data for Boston Technology, compute the firmâs degree of combined leverage.
Assume a marginal tax rate of 40%.
2010 2011
Sales $700,000 $760,000
Fixed costs 175,000 190,000
Variable costs 406,000 448,000
EBIT 119,000 122,000
Interest 42,000 46,000
Shares outstanding 100,000 102,000
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