Exercise 6-9 (Algo) Compute and Use the Degree of Operating Leverage [LO6-8] Engberg Company installs lawn sod in home yards. The company's most recent monthly contribution format income statement follows: Percent of Amount Sales Sales Variable expenses $ 137,000 100% 54,800 40% Contribution margin 82,200 60% Fixed expenses 18,000 Net operating income $ 64,200 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 15% increase in unit sales. 3. Construct a new contribution format income statement for the company assuming a 15% increase in unit sales. Complete this question by entering your answers in the tabs below. ces 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 Exercise 6-9 (Algo) Compute and Use the Degree of Operating Leverage [LO6-8] Engberg Company installs lawn sod in home yards. The company's most recent monthly contribution format income statement follows: Percent of Amount Sales. Sales Variable expenses Fixed expenses $ 137,000 100% 54,800 40% Contribution margin 82,200 608 18,000 Net operating income $ 64,200 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 15% increase in unit sales. 3. Construct a new contribution format income statement for the company assuming a 15% increase in unit 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 15% 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).) Net operating income % Percent of Amount Sales Sales $ 137,000 100% Variable expenses 54,800 40% Contribution margin 82,200 60% Fixed expenses 18,000 Net operating income $ 64,200 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 15% increase in unit sales. 3. Construct a new contribution format income statement for the company assuming a 15% increase in unit sales. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 inces Construct a new contribution format income statement for the company assuming a 15% increase in unit sales. Engberg Company Contribution Income Statement Sales Variable expenses Contribution margin Amount Percent of Sales 100 % % 0 100 % Fixed expenses Net operating income $ 0 Required 2 Required 35