Engberg Company installs lawn sod in home yards. The company's most recent monthly contribution format income statement follows: Percent of Sales Variable expenses Amount Sales $ 86,000 100% 34,400 40% Contribution margin 51,600 60% 40,420 $ 11,180 Fixed expenses Net operating income Required: 1. What is the company's degree of operating leverage? 2. Using the degree of operating leverage, estimate the impact on net operating income of a 5% increase in unit sales. 3. Construct a new contribution format income statement for the company assuming a 5% increase in unit sales. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Using the degree of operating leverage, estimate the impact on net operating income of a 5% increase in unit sales. (Round your intermediate calculations to 2 decimal places. Round your percentage answer to 2 decimal places (i.e.1234 should be entered as 12.34).) Net operating income increases by 32.31 % < Required 1 Required 3 > Engberg Company installs lawn sod in home yards. The company's most recent monthly contribution format income statement follows: Sales Variable expenses Contribution margin Fixed expenses Net operating income Required: Amount $ 86,000 Percent of Sales 100% 34,400 40% 51,600 60% 40,420 $ 11,180 1. What is the company's degree of operating leverage? 2. Using the degree of operating leverage, estimate the impact on net operating income of a 5% increase in unit sales. 3. Construct a new contribution format income statement for the company assuming a 5% increase in unit sales. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Construct a new contribution format income statement for the company assuming a 5% increase in unit sales. Engberg Company Contribution Income Statement Sales Variable expenses Contribution margin Fixed expenses Net operating income Amount Percent of Sales $ 92,020 100% 36,808 40 % 55,212 60 % 40,420 $ 14,792 < Required 2 Required 3