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4. Assume that the operating results for last year were: Sales$2,080,000Variable expenses1,040,000Contribution margin1,040,000Fixed expenses200,000Net operating income$840,000 a. Compute the degree of operating leverage at the

4. Assume that the operating results for last year were:

Sales$2,080,000Variable expenses1,040,000Contribution margin1,040,000Fixed expenses200,000Net operating income$840,000

a. Compute the degree of operating leverage at the current level of sales.(Round your answer to 2 decimal places.)

b. The president expects sales to increase by 11% next year. By what percentage should net operating income increase?

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