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CFA Level 1
Corporate Finance

Total Leverage Calculation for ABC Corporation

Easy Measures Of Leverage Total Leverage

ABC Corporation has the following financial data for the current year:

- Earnings Before Interest and Taxes (EBIT): $500,000

- Fixed Costs: $300,000

- Variable Costs per Unit: $10

- Selling Price per Unit: $25

If ABC Corporation sells 20,000 units, what is the Total Leverage of the company?

Hint

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