Last month Annie's Homemade total sales, variable costs, and fixed costs were $25,000, 6,250, and $11,000, respectively.

Required:

1. What was last months degree of operating leverage? (Round your answer to two digits to the right of the decimal.)

2. If next months unit sales increase by 10% and the selling price per unit, variable cost per unit, and total fixed cost remain the same, then next months net operating income will increase by what percentage? (Round your answer to the nearest tenth of a percent.)