Engberg Company installs lawn sod in home yards. The company's most recent monthly contribution format income statement follows:

	Amount	Percent of Sales
Sales	$134,000	100%
Variable expenses	53,600	40%
Contribution margin	80,400	60%
Fixed expenses	15,000
Net operating income	$65,400

Requirement 1:

Compute the company's degree of operating leverage.(Round your answer to 2 decimal places.)

Degree of operating leverage

Requirement 2:

Using the degree of operating leverage, estimate the impact on net operating income of a 30% increase in sales.(Do not round intermediate calculations. Round your answer to 2 decimal places, e.g., .1234 as 12.34. Omit the "%" sign in your response.)

Estimated percent change in net operating income

%

Requirement 3:

Verify your estimate from requirement (2) by constructing a new contribution format income statement for the company assuming a 30% increase in sales.(Round "percent change" to 2 decimal places, e.g., .1234 as 12.34. Final answer may vary from Requirement 2 due to rounding.Input all amounts as positive values.Omit the "$" and "%" signs in your response.)

	Amount
Sales	$
Variable expenses
Contribution margin
Fixed expenses
Net operating income	$
Original net operating income	$
Percent change in net operating income	%