The information relating to X & Co. is given below:- EBIT = Rs 1120000 PBT = Rs 320000 Fixed Cost = Rs 700000 Calculate the change in EPS if sales are expected to increase by 5%.
Solution: Degree of Combined Leverage i.e. Multiplication of Operating Leverage and Financial leverage denotes the relationship between Sales and Earning per share (EPS) of the firm. In other words, % change in EPS as...