Valley Planing Co. has fixed costs of $800,000, including depreciation of $100,000. The EBITDA is $250,000. Calculate the cash flow operating leverage.

Managerial Accounting: The Cornerstone of Business Decision-Making
7th Edition
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Chapter3: Cost Behavior And Cost Forecasting
Section: Chapter Questions
Problem 8DQ: Describe the cost formula for a strictly fixed cost such as depreciation of 15,000 per year.
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Calculate cash flow operating leverage on these financial accounting question

Valley Planing Co. has fixed costs of $800,000, including
depreciation of $100,000. The EBITDA is $250,000. Calculate the
cash flow operating leverage.
Transcribed Image Text:Valley Planing Co. has fixed costs of $800,000, including depreciation of $100,000. The EBITDA is $250,000. Calculate the cash flow operating leverage.
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