Lexi85101 Lexi85101
  • 30-04-2024
  • Business
Answered

A manufacturing company has the following financial information (in millions of $):
Sales = 823
Cost of goods sold:
Direct labor = 85
Purchase materials = 310
Overhead =94
All other costs =250
Pretax earnings =84
a. What is the profit leverage effect of purchasing in this company?
b. What is the increase in earnings from an 8 percent savings in purchasing?



Answer :

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