Hanna Company manufactures and sells juice drinks in tetra packs of various flavors. Hanna set the selling price at P5 per 16-oz pack. For the year 2022, the company estimates the following revenues andexpenses.

Net sales 1,800,000

Direct materials 420,000

Direct labor 362,000

Variable manufacturing overhead 316,000

Fixed manufacturing overhead 283,000

Variable selling and administrative expenses 90,000

Fixed selling and administrative expenses 125,000

Required (independent cases):

1. What is the degree of operating leverage?
2. What is the net income if the sales increase by 45%?
3. What is the net income if the sales decrease by 20%
4. What is the sales if net income increased by 60%?
5. What is the sales if the net income decreased to 100,000?

Hanna Company manufactures and sells juice drinks in tetra packs of various flavors. Hanna set the selling price at P5 per 16-oz pack. For the year 2022, the company estimates the following revenues and expenses. Net sales 1,800,000 Direct materials 420,000 Direct labor 362,000 Variable manufacturing overhead 316,000 Fixed manufacturing overhead 283,000 Variable selling and administrative expenses 90,000 Fixed selling and administrative expenses 125,000 Required (independent cases): a. What is the degree of operating leverage? b. What is the net income if the sales increase by 45% ? c. What is the net income if the sales decrease by 20% d. What is the sales if net income increased by 60% ? e. What is the sales if the net income decreased to 100,000 ? Net Sales (1,800,000/5=360,000) Sales 1,800,000 Variable Cost 1,188,000 CM 612,000 Fixed Cost 408,000 Net Income 204,000