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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 Fixed
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 $ 80,000 Percent of Sales 100% 32,000 40% 48,000 60% 38,000 $ 10,000 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.
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