7A (Break-even point, Operating Leverage)

Question 4

The Poseidon Swim Company produces swim trunks. The average selling price for one of their swim trunks is $72.06. The variable cost per unit is $26.73. Poseidon Swim has average fixed costs per year of $7,824. Determine the degree of operating leverage for the level of production and sales 351 swim trunks. Round the answer to two decimal places.