If EBIT equals $280,000 and interest equals $20,000, with a tax rate of 31%, what is the degree of financial leverage?

Name: If EBIT equals $280,000 and interest equals $20,000, with a tax rate of 31%, what is the degree of financial leverage?
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The degree of financial leverage (DFL) is calculated as EBIT / (EBIT - Interest). Here, DFL = $280,000 / ($280,000 - $20,000) = $280,000 / $260,000 = 1.08x.

If EBIT Equals $280,000 and Interest Equals $20,000, with a Tax