Below is Income Statement information for Bobs Burgers Inc.
Revenue: $3,107,262
Variable costs: 30% of revenue
Fixed costs: $1,000,000
Depreciation: $475,000
Bond Issue A: $300,000 face value, 10% coupon
Bond Issue B: $500,000 face value, 8% coupon
Bond Issue C: $900,000 face value, 12% coupon
Tax rate: 40%
Common shares issued and Outstanding: 250,000
Calculate the degree of operating leverage for the firm.
Calculate the degree of financial leverage for the firm.
Calculate the degree of combined leverage for the firm.