Marina Manufacturing is considering buying new equipment for its factory. The new equipment will reduce variable labor costs but increase depreciation expense. Contribution margin is expected to increase from $250,000 to $300,000. Net income is expected to remain the same at $100,000.

Compute the degree of operating leverage before and after the purchase of the new equipment and interpret your results. (Round answers to 2 decimal places, e.g. 15.25.)