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Question 15 Not yet answered Marked out of 7 P Flag question The following CVP income statements are available for Al-Quds Corp. which has two plants A and B. Plant A Plant B Sales Revenue 5,000,000 5,000,000 Variable Cost 3,000,000 1,500,000 Contribution Margin 2,000,000 3,500,000 Fixed Cost 600,000 2,500,000 Net Income 1,400,000 1,000,000 Instructions 1. Compute the degree of operating leverage for the two plants (you can use the following table). 2. Determine which plant's cost structure contains more risk to change in sales volume and Why? 3. Determine the effect on each plant's net income if sales revenue decreased by 5%. A B. 1 III U to S XX2 S 1. Plant A Plant B Degree of Operating Leverage