REQUIRED Operating Leverage Example ABC Company ABC Company XYZ Company XYZ Company $ 600,000 $ 1,000,000 $ 600,000 $1,000,000 Sales Variable Costs: Cost of goods sold % of sales) Sales taxes Sales commissions Contribution Margin Fixed Costs: Manufacturing OH Selling & Admin Net Income 300,000 (50%) 30,000 (5%) 60,000(10%) 210,000 180,000 (30%) 30,000 (5%) 60,000 (1096) 330,000 75,000 35,000 $ 100,000 75,000 35,000 195,000 35,000 $ 100.000 195,000 35,000 Operating Leverage: The higher the proportion of FIXED COSTS in a company's cost structure, the GREATER the impact (good or bad) of a change in sales. Ouestion 3 Operating Leverage Example With $600,000 sales, what is the Operating Leverage for ABC Company? BLANK-1 With $600,000 sales, what is the Operating Leverage for XYZ Company? BLANK-2 With $1,000,000 Sales ABC Company - Cost of goods sold BLANK-3 Sales taxes BLANK-4 Sales commissions BLANK-5 Contribution Margin BLANK-6 Net Income BLANK-7 With $1,000,000 Sales XYZ Company - Cost of goods sold BLANK-8 Sales taxes BLANK-9 Sales commissions BLANK-10 Contribution Margin BLANK-11 Net Income BLANK-12 Which company showed the greatest impact from the increase in sales? BLANK-13