Engberg Company installs lawn sod in home yards. The companys most recent monthly contribution format income statement follows: Amount Percent of Sales Sales $ 131,000 100% Variable expenses 52,400 40 Contribution margin 78,600 60% Fixed expenses 17,000 Net operating income $ 61,600 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 12% increase in unit sales. 3. Construct a new contribution format income statement for the company assuming a 12% increase in unit sales.