Engberg Company installs lawn sod in home yards. The companys most recent monthly contribution format income statement follows: Amount Percent of Sales Sales $ 133,000 100% Variable expenses 53,200 40% Contribution margin 79,800 60% Fixed expenses 24,000 Net operating income $ 55,800

Required: 1. What is the companys degree of operating leverage?(Round your answer to 2 decimal places.)

2. Using the degree of operating leverage, estimate the impact on net operating income of a 21% 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).)

3. Construct a new contribution format income statement for the company assuming a 21% increase in unit sales.