(Principles Of Finance)

Leverage

DOL = Degree of Operating Leverage. DFL = Degree of Financial Leverage. DCL = Degree of Combined Leverage. DTL = Degree of Total Leverage. VC = Variable Cost Per Unit. FC = Fixed Cost. EBIT = Earning Before Interest Taxes. EBT = Earning Before Taxes. EAT = Earning After Taxes. SP = Selling Price Per Unit. EPS = Earning Per Share. BEP = Break Even Point. N.S = Number of Share. TVC = Total Variable Cost. EACS = Earning Available. PSD = Preference Share Dividend.
Calculation Table

Particular/Details Sales (-) Variable Cost Contribution (-) Fixed Cost EBIT ( Earning Before Interest Taxes) ( -) Interest EBT (-) Tax ( On EBT ) EAT (-) EEH/EACS No of Share = EPS =

Amount (Tk.) ********* ********* ********* ********* ********* ********* ********* ********* ********* ********* *********

1.

DOL(Degree of Operating Leverage) : DOL = / / /

2.

DFL(Degree of Financial Leverage) : DFL = =***times.

PSD

DFL =

[tr= Tax Rate].

3.

DCL(Degree of Combined Leverage) : DCL/DTL = DOL DFL. =*** times.

4.

BEP (Break Even Point) : BEP (Unit) = BEP (Tk.) = BEP (u) BEP (Tk.) = VCPU = Sales (u) . Sales. Contribution (u)

# Contribution BEP = BEP (u)

= BEP (u) (SP-VC) . 5. Target Profit : Target Sales (u) = TS (Tk.) = Ts (u) TS (Tk.) = 100 Sales (u) . Sales (u) .

6. PV/Contribution ratio :- = 7.Asset Turn Over/ Asset Leverage :- =

# Total Asset = Common Stock ******

% Preference Share ****** % Intrest/Debt. ****** _______________________ = Total Asset

8.Total Asset =

.
100

9. ROI (Return On Investment) :10. ROE (Return On Equity) :ROE = Or, =

100 100

11. EPS(Earning Per Share) :EPS = 12. Financial/F. BEP :- = Interest +

13. Fc :- Sales Vc- EBIT. 14. EAT :- = EBIT-Interest. / Or,

= Sales Vc Fc Interest.

15. EBIT :- Total Assets 16. Vc.ratio:- = 17. BEP.Ratio :-=

ROI

100.
100.

18. Contribution Per Unit :- = Sales Per unit Vc Per unit . 19. Sales :- Total Assets 20. CM/PV ratio:Assets Tornover Ratio. 100. CM = Contribution Margin.

21. Debt Eeuity ratio =

22. Margin Of Safety = Sales- BEP Sales. 23. Raise in Sales/Additional Sales :- Target Sales Present Sales. 24. % Raise in Sales/%Additional Sales :25. Effect/Impact Of DOL,DFL,DTL/DCL :% Change in Sales (% DOL) = Change in EBIT % Change in EBIT (% DFL) = Change in EPS % Change in Sales (%DTL/DCL) = % Change in EPS

26. Increase :% Increase/Change in EBIT = % Increase/Change in EPS % Increase/Change in Sales =

= 100

100

100.