In financial management, if a company's Degree of Operating Leverage (DOL) is 2.5 and Degree of Financial Leverage (DFL) is 1.5, what is the Degree of Combined Leverage (DCL)? MCQ with Answer and Explanation
In financial management, if a company's Degree of Operating Leverage (DOL) is 2.5 and Degree of Financial Leverage (DFL) is 1.5, what is the Degree of Combined Leverage (DCL)?
A. 1.0
B. 1.66
C. 3.75
D. 4.0
Answer: Option C
Solution (By JKSSB Mock Tests)
DCL = DOL * DFL. Therefore, DCL = 2.5 * 1.5 = 3.75. This indicates that a 1% change in sales will result in a 3.75% change in EPS.
S1: The Purchases Return Book records returns of goods purchased on credit. S2: The Purchases Return Book is also called the Returns Outwards Book. Which statement(s) is/are correct?
Explanation:
The Purchases Return Book records goods returned to suppliers that were originally purchased on credit. It is also known as the Returns Outwards Book because goods are going out of the business. Both statements are correct.
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