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Martinez Manufacturiing is considering buying new equipment for its factory. The new equipment will reduce variable labor costs but increase depreciation expense. Contribution margin is

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Martinez Manufacturiing 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 $240,000 to $288.000. Net income is expected to remain the same at $100,000. Compute the degree of operating leverage betore and after the purchase of the new equipment. (Round answers to 2 decimal places, e.8. 15.25.)

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