E12.11. Analysis of Effects of Operating Leverage: US Airways (Medium) Refer to the 1998 income statement for US Airways Group in Exercise E12.10 above. Of the total $7,674 million in operating expenses, suppose the following are fixed costs (in millions): Personnel Aircraft rent Other rent Depreciation and amortization Other Total $2,040 440 350 318 890 $4,038

a. Calculate the fum's operating leverage.

b. What would be the percentage change in core operating income from sales before tax if there were a 1 percent increase in sales?

c. At what level of sales would the airline incur operating losses? Real World Connection See Exercise E12.10 in this chapter for more material on US Airways.