Engberg Company installs lawn sod in home yards. The companys most recent monthly contribution format income statement follows: Amount Percent of Sales Sales $ 140,000 100% Variable expenses 56,000 40 Contribution margin 84,000 60% Fixed expenses 24,000 Net operating income $ 60,000 Required: 1. What is the companys degree of operating leverage? 2. Using the degree of operating leverage, estimate the impact on net operating income of a 26% increase in unit sales. 3. Construct a new contribution format income statement for the company assuming a 26% increase in unit sales.