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Req 1A Req 1B Req 2 Calculate the degree of operating leverage (DOL) for each company. (Round your answers to 3 decimal places.) Degree
Req 1A Req 1B Req 2 Calculate the degree of operating leverage (DOL) for each company. (Round your answers to 3 decimal places.) Degree of operating leverage Company A < Req 1A Company B Req 1B > Req 1A Req 1B Req 2 If sales increase from the present level, which company benefits more? Company A OCompany B < Req 1A Req 2 > Req 1A Req 1B Req 2 Assume that sales rise 5% in the next year but that everything else remains constant. Calculate the percentage increase in profit for each company. (Input your answers as percentages rounded to 2 decimal places (i.e., 0.1567 = 15.67%).) Increase in profit Company A % Company B % < Req 1B Req 2 Company A Percent of Company B Percent of Sales Amount $230,000 Sales 100% Amount $230,000 100% 115,000 50 69,000 30 $115,000 50% $161,000 70% 18,400 57,400 $103,600 Sales Variable costs Contribution margin Fixed costs Operating profit $ 96,600
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