Exercise 5-9 (Algo) Compute and Use the Degree of Operating Leverage (LO5-8] Engberg Company installs lawn sod in home yards. The company's most recent monthly contribution format income statement follows: 52 Sales es Variable expenses Contribution margin Fixed expenses Percent of Amount Sales $146,000 100% 58,400 40 87,600 60% 20,000 $ 67,600 Net operating income 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 11% increase in unit sales. 3. Construct a new contribution format income statement for the company assuming a 11% increase in unit 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 1 Required 2 > < Prev Prev 26 of 28 Next >