Question
Information for two companies follows: Skittles Company Sales Contribution margin Fixed costs $ 6,151,450 4,951,450 3,897,950 Starburst Company $ 3,739,000 1,414,000 909,000 (1) Compute
Information for two companies follows: Skittles Company Sales Contribution margin Fixed costs $ 6,151,450 4,951,450 3,897,950 Starburst Company $ 3,739,000 1,414,000 909,000 (1) Compute the degree of operating leverage (DOL) for each company. (2) Which company is expected to produce a greater percent increase in income from a 30% increase in sales? Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Required Required 2 Compute the degree of operating leverage (DOL) for each company. Degree of Operating Leverage Numerator: Denominator: Ratio Variable costs Sales Degree of Operating Leverage Skittles's DOL Starburst's $ 1,200,000/ $ 1,053,500 1.14 S DOL 2,325,000/ $ 505,000 4.60 Required 1 Required 2 >
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