Engberg Company installs lawn sod in home yards. The company's most recent monthly contribution format income...
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Engberg Company installs lawn sod in home yards. The company's most recent monthly contribution format income statement follows: Sales Variable expenses Contribution margin Amount $ 86,000 Percent of Sales 34,400 51,600 100% 40 60% Fixed expenses Net operating income Required: 39,560 $ 12,040 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 7% increase in unit sales. 3. Construct a new contribution format income statement for the company assuming a 7% increase in unit sales. Required 1 Required 2 Required 3 What is the company's degree of operating leverage? (Round your answer to 2 decimal places.) Degree of operating leverage Required 1 Required 2 Required 3 Using the degree of operating leverage, estimate the impact on net operating income of a 7% 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 by % Required 1 Required 2 Required 3 Construct a new contribution format income statement for the company assuming a 7% increase in unit sales. Engberg Company Contribution Income Statement Amount Percent of Sales % % % Engberg Company installs lawn sod in home yards. The company's most recent monthly contribution format income statement follows: Sales Variable expenses Contribution margin Amount $ 86,000 Percent of Sales 34,400 51,600 100% 40 60% Fixed expenses Net operating income Required: 39,560 $ 12,040 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 7% increase in unit sales. 3. Construct a new contribution format income statement for the company assuming a 7% increase in unit sales. Required 1 Required 2 Required 3 What is the company's degree of operating leverage? (Round your answer to 2 decimal places.) Degree of operating leverage Required 1 Required 2 Required 3 Using the degree of operating leverage, estimate the impact on net operating income of a 7% 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 by % Required 1 Required 2 Required 3 Construct a new contribution format income statement for the company assuming a 7% increase in unit sales. Engberg Company Contribution Income Statement Amount Percent of Sales % % %
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