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Homework - Chapter 11 G Saved Help Save & Exit Submit The following income statement was drawn from the records of Rooney Company, a merchandising firm: 5 ROONEY COMPANY Income Statement Por the Year Ended December 31, 2018 Sales revenue (7,000 units $164) Cost of goods sold (7,000 units x $90) Gross margin Sales commissions (58 of sales) Administrative salaries expense Advertising expense Depreciation expense Shipping and handling expenses (7,000 unita * $3) Net income $1,148,000 630,000) 518,000 (57,400) (81,000) (33,000) 45,000) (21,000) 27.77 points eBook 280,600 Hint Required a. Reconstruct the income statement using the contribution margin format. b. Calculate the magnitude of operating leverage. c. Use the measure of operating leverage to determine the amount of net income Rooney will earn if sales increase by 10 percent. Complete this question by entering your answers in the tabs below Req A Req B and c Reconstruct the income statement using the contribution margin format. Homework-Chapter 11 6 Saved Help Save & Exit Submit Complete this question by entering your answers in the tabs below 5 Req AReq B and C Reconstruct the income statement using the contribution margin format. 27.77 points ROONEY COMPANY Income Statement For the Year Ended December 31, 2018 Skipped Less: Variable costs eBook Hint References Less: Fixed costs Req B and c> ReqA Required a. Reconstruct the income statement using the contribution margin format. b. Calculate the magnitude of operating leverage. c. Use the measure of operating leverage to determine the amount of net income Rooney will earn if sales increase by 10 percent. 2777 points Complete this question by entering your answers in the tabs below Skipped Req AReq B and C eBook Hint References Calculate the magnitude of operating leverage. Use the measure of operating leverage to determine the amount of net income; Rooney will earn if sales increase by 10 percent. (Round "Operating leverage" to 2 decimal places and round "Net income" answer to nearest whole dollar) b. Operating leverage c. Net income times Req Req B and C