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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 expenses

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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 expenses Net operating income Amount $ 128,000 51,200 76,800 20,000 56,800 Percent of Sales 100% 40% 604 Required: 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 13% increase in sales. 3. Construct a new contribution format income statement for the company assuming a 13% increase in sales. Complete this question by entering your answers in the tabs below. 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 Required 2 > Percent of Sales 100% 404 Sales Variable expenses Contribution margin Fixed expenses Net operating income Amount $ 128,000 51,200 76,800 20,000 $ 56,800 60% Required: 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 13% increase in sales. 3. Construct a new contribution format income statement for the company assuming a 13% increase in sales. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Using the degree of operating leverage, estimate the impact on net operating income of a 13% increase in sales. (Do not round intermediate calculations. Round your percentage answer to 2 decimal places (1.e 0.1234 should be entered as 12.34).) by Net operating income % 60% Contribution margin Fixed expenses Net operating income 76,800 20,000 $ 56,800 Required: 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 13% increase in sales. 3. Construct a new contribution format income statement for the company assuming a 13% increase in sales. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Construct a new contribution format income statement for the company assuming a 13% increase in sales. Engberg +3mpany Contribution Income Statement Amount Percent of Sales % % 0 % 0 $ 0

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