From the following details of X Ltd, PREPARE the Income Statement for the year ended 31st December: Financial Leverage 2 Interest 2,000 Operating…

Income Statement DFL = \frac{\text{EBIT}}{\text{EBT}} EBITEBT EBIT EBT = \frac{\text{EBT + Interest}}{\text{EBT}} EBT + InterestEBT EBT + Interest EBT = \frac{2}{1} 21 2 1 EBT + 2,000 = 2 EBT. EBT = 2,000 EBIT = EBT + Interest = 2000 +2000 = 4,000. Contribution = \frac{\text{Contributon}}{\text{EBIT}} ContributonEBIT Contributon EBIT = \frac{3}{1} 31 3 1 \frac{\text{Contributon}}{4,000} Contributon4,000 Contributon 4 , 000 = 3 Contribution = 12,000 48,000 Sales \frac{\text{Contributon}}{\text{PVR}} ContributonPVR Contributon PVR = \frac{12,000}{25\%} 12,00025% 12 , 000 25 % Less: Variable Cost Given = 75% (36,000) Contribution 12,000 Less: Fixed Cost( Contribution - EBIT = 12,000 - 4,000) (8,000) EBIT 4,000 Less: Interest (2,000) EBT 2,000 Less: Tax at 30% (600) EAT 1,400