Blue Spruces vice president of finance has offered another option. He suggests a different system that combines personal service at key points in the cafeteria line with a less expensive automated self -service system for the other items. The financial information on this system is given below: Blended Service System Sales $2,160,000 Variable costs 1,188,000 Contribution margin $972,000 Fixed costs 648,000 Net Income $324,000

(1) Determine the degree of operating leverage for this option. (Round answer to 2 decimal places, e.g. 15.25.) Operating leverage enter the degree of operating leverage rounded to 2 decimal places 3.00

(2) How much would net income increase if sales increased by $216,000? (Round answer to 2 decimal places, e.g. 15.25%.)

Net income: %