Percentage change in EBIT= 491 450-366 000 x 100
366 000
= 34.28%
Percentage change in sales = 786 450-636 000 x 100
636 000
= 23.66%
DOL= 34.28/23.66
= 1.45
Calculations
Sales in 2017 = 30 000 units x (20 x 1.06)
Sales in 2018 = 35 000 units x (21.2x 1.06) round the price to 2 decimal places before
multiplication
(2.2) component costs of capital
Component Weight After tax costs WACC
Debt 25% 13.29 3.32
Preference shares 15% 10.96 1.64
Ordinary shares 60% 13.48 8.09
13.05
Calculations
After tax costs of: debt = 180 + (1000-950)/20
(1000+950)/2 flotation costs are deducted to arrive at 950
Multiply by 100 and then by (1-0.29)
Preference dividends = {8/ (80-7)} x 100
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