Question 2 (6 marks) You have been provided the following income statements Turbo Industries and Prop Corporation. INCOME STATEMENT IN ($000s) TURBO PROP Sales Cost of Goods Sold Fixed costs Depreciation Earnings Before Interest and Taxes Interest Income Before Taxes Income Taxes Net Income Shares ols 3,576 1,604 661 475 836 631 205 62 143 100 2,020 1,009 545 213 253 154 99 30 69 75 a. Calculate the degree of operating leverage for each firm. (2) *Note, depreciation is also a fixed cost b. If both firms were to experience a 15% increase in sales, what is the percentage change impact in Earnings Before Interest and Taxes (EBIT) and what is the new EBIT for each firm. (4)