Question
Oslo Company prepared the following contribution format income statement based on a sales volume of 1,000 units (the relevant range of production is 500 units
Oslo Company prepared the following contribution format income statement based on a sales volume of 1,000 units (the relevant range of production is 500 units to 1,500 units): Sales $ 21,500 Variable expenses 12,500 Contribution margin 9,000 Fixed expenses 7,200 Net operating income $ 1,800 4. If sales increase to 1,001 units, what would be the increase in net operating income? 12. What is the degree of operating leverage? 13. Using the degree of operating leverage, what is the estimated percent increase in net operating income of a 3% increase in sales?
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