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Engberg Company installs lawn sod in home yards. The company's most recent monthly contribution format income statement follows: Percent of Sales Amount Sales $ 138,000 100% 55,200 40% Variable expenses Contribution margin 82,800 60% Fixed expenses 21,000 Net operating income $ 61,800 Required: 1. What is the company's degree of operating leverage? 2. Using the degree of operating leverage, estimate the impact on net operating income of a 25% increase in unit sales 3. Construct a new contribution format income statement for the company assuming a 25% increase in unit sales
se uus question by emering your answers in the tabs below. Required 1 Required 2 Required 3 What is the company's degree of operating leverage? (Round your answer to 2 decimal places.) Degree of operating leverage Required 2 >
es Required 11 Required 2 Required 3 Using the degree of operating leverage, estimate the impact on net,operating income of a 25% increase in unit sales. (Round your intermediate calculations to 2 decimal places. Round your percentage answer to 2 decimal places (.e.1234 should be entered as 12.34).) Net operating income by % < Required 1 Required 3 >
ces Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Construct a new contribution format income statement for the company assuming a 25% increase in unit sales. Engberg Company Contribution Income Statement Amount Percent of Sales 16 0 0 < Required 2 0%