标题: Jumbled DOL and DFL formulas? [打印本页] 作者: MonkeyBusiness 时间: 2013-8-6 10:16 标题: Jumbled DOL and DFL formulas?
DOL = Percentage change in operating income / Percentage change in units sold
= Q(P-V) / Q(P-V)-F
Aren’t the numerator and denominator jumbled and don’t agree with corresponding text description?
DFL = Percentage change in net income / Percentage change in operating income
= Q(P-V)-F / Q(P-V)-F-C
Same comment here. Isn’t Q(P-V)-F the operating income and Q(P-V)-F-C the net income?
If I remember correctly, this is also the way they are presented in the CFAI readings. If this is the case, should we follow the formula over the text description?作者: cjs238 时间: 2013-8-6 10:17
Thanks for your explanation. But if I may, I’d like to ask further to clear out something that’s bugging me or maybe I’m just missing out on something. Isn’t it that if we deduct the C (fixed financial cost) from OI, we will get the NI? If that’s the case, then why is the numerator without minus C described as the %change in NI and the denominator with minus C, described as the % change in OI.作者: John10 时间: 2013-8-6 10:17
I asked this a while ago. I still don’t really get it. I’m just going to memorize the formula and be done with it. It’s not just net income, it’s the change in net income作者: Zestt 时间: 2013-8-6 10:17
Okay, I trust you Sir. There’s no time to think it through now.
Thanks Hei so. Wish i had stumbled upon this forum a long time ago. Would have saved much time.
