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Crane's Shingle Corporation is considering the purchase of a new automated shingle-cutting machine. The new machine will reduce variable labor costs but will increase
Crane's Shingle Corporation is considering the purchase of a new automated shingle-cutting machine. The new machine will reduce variable labor costs but will increase depreciation expense. Contribution margin is expected to increase from $225,420 to $270,504. Net income is expected to be the same at $44,200. Compute the degree of operating leverage before and after the purchase of the new equipment. (Round answers to 2 decimal places, e.g. 1.52.) Degree of operating leverage (old) Degree of operating leverage (new) 5.1
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