NanoForge Company installs lawn sod in home yards. The company's most recent monthly contribution format income...

Transcribed Image Text:

NanoForge Company installs lawn sod in home yards. The company's most recent monthly contribution format income statement is provided below. Using the degree of operating leverage, estimate the impact on net operating income (i.e., % change in net operating income) of a 5% increase in unit sales. Sales Amount Percent of Sales $200,000 100% Variable expenses 50,000 25% Contribution margin 150,000 75% Fixed expenses 100,000 Net operating income $50,000 NanoForge Company installs lawn sod in home yards. The company's most recent monthly contribution format income statement is provided below. Using the degree of operating leverage, estimate the impact on net operating income (i.e., % change in net operating income) of a 5% increase in unit sales. Sales Amount Percent of Sales $200,000 100% Variable expenses 50,000 25% Contribution margin 150,000 75% Fixed expenses 100,000 Net operating income $50,000

Answer rating: 100% (QA)

Answer Estimating Impact on Net Operating Income with Degree of Operating Leverage Given Sales 20000... View the full answer