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Company A and B are both projecting an increase in sales of 12 percent. Company A has an operating leverage of 2.4 while Company B

Company A and B are both projecting an increase in sales of 12 percent. Company A has an operating leverage of 2.4 while Company B has an operating leverage of 2.0. Which of the following statements is correct with respect to the expected change in operating net income?

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Operating Income for Company A and B are both expected to increase by same percentage

Operating Income for Company B is expected to increase by 6 percent

Operating Income for Company B is expected to increase by a lower percentage than Company A

Operating Income for Company A expected to increase by 5 percent

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