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Required information [ The following information applies to the questions displayed below. ] Oslo Company prepared the following contribution format income statement based on a
Required information
The following information applies to the questions displayed below.
Oslo Company prepared the following contribution format income statement based on a sales volume of units the
relevant range of production is units to units:
What is the degree of operating leverage?
Degree of operating leverage
Using the degree of operating leverage, what is the estimated percent increase in net operating income that would result from a
increase in unit sales?
Assume the amounts of the company's total variable expenses and total fixed expenses were reversed. In other words, assume the
total variable expenses are $ and the total fixed expenses are $ Under this scenario and assuming total sales remain the
same, what is the degree of operating leverage?
Degree of operating leverage
Assume the amounts of the company's total variable expenses and total fixed expenses were reversed. In other words, assume the
total variable expenses are $ and the total fixed expenses are $ Using the degree of operating leverage, what is the
estimated percent increase in net operating income of a increase in unit sales?
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