Page 42 - FINAL CFA I SLIDES JUNE 2019 DAY 10
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Session Unit 11:
                                                                                                      37. Measures of Leverage
        The degree of total leverage (DTL) combines the DOL and DFL;

        it measures the sensitivity of EPS to change in sales (p.70):

                                                =  = Contribution/GP               *  EBIT              = Contribution/GP

                                                        EBIT                       Net Income                   Net income









                                                         tanties











          Alternatively, DTL (the long way) from the previous example, the current value of Atom’s dollar sales is
          $4 × 100,000 = $400,000.
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