Exercise 6-16 a1, b (Video) An investment banker is analyzing two companies that specialize in the production and sale of candied yams. Traditional Yams uses a labor-intensive approach, and Auto-Yams uses a mechanized system. CVP income statements for the two companies are shown below. Traditional Sales Variable costs Contribution margin Fixed costs Net income Auto-Yams $402,000 $402,000 56,000 80,000 246,000 196,000 $50,000 $50,000 322,000 0,000 The investment banker is interested in acquiring one of these companies. However, she is concerned about the impact that each company's cost structure might have on its prontability Calculate each company's degree of operating leverage. (Round answers to 2 decimal places, e.g. 1.15 Degree of Operating Leverage Traditional Yams Auto-Yams net income r sales decrease by 10% and if sales increase by 7%, Do not prepare income statements. (Round answers to 2 decimal places, e.g. 10.52. If % change is negative, enter amount with either a negative sign or parenthesis, e.g.-10.52 or (10.52) % change in Net Income Sales desrense by 109% Traditional Yams Auto-Yams Sales increaseby 75% Traditional Yarms