ssignment/kessignmentMain.doFinvokerStakeAssignmentSessionLocatorinprogress-false Degree of Operating Leverage. Percent Change in Profit Ringmith Company is considering two different processes to make its product-process and process 2. Process 1 requires Ringsmith to manufacture subcomponents of the product in-house. As a result, materials are less expensive overhead is higher. Process involves purchasing a subcomponents from outside suppliers. The direct materials costs are higher, but foved factory overhead is considerably lower. Relevant data for a sales level of 28,000 units follow: Process 1 Process 2 Sales $7,056,000 57,056,000 V expenses 2,604 000 4,168,000 Contribution margin 14.452.000 $2,688.000 Lested expenses 3.766,515 1,523.910 Opening income $683,485 51,164,00 Uniting price Unit variable 593 5156 Unit contion margin Required: 1. Compute the degree of cering verge for each process. Round your owerste del paese the rounded answers in subsequent cations Process Process 2. Support that sales are 20 percent higher than buty what percentage wiring an increase the What will be the for each Bound your answer to the nearest Preces 1.77.6 x cent Change in Prohit Ringsmith Company is considering two different processes to make its product-pronss 1 and process 2. Process 1 requires Ringsmith to manufacture subcomponents of the p overhead is higher. Process 2 involves purchasing all subcomponents from outside suppliers. The direct materials costs are higher, but fixed factory overhead is considerably lo Process 1 Process 2 $7,056,000 4,368,000 Sales Variable expenses Contribution margin Less total fixed expenses Operating income Unit selling price Unit variable cost Unit contribution margin Required: $7,056,000 2,604,000 $4,452,000 3,768,515 $683,485 $2,688,000 1,523,910 $1,164,090 5252 $93 $252 $156 $96 $159 1. Compute the degree of operating leverage for each process. Round your answers to one decimal place. Use the rounded answers in subsequent calculations Process 1 6.5 I Process 2 2.3 2. Suppose that sales are 20 percent higher than budgeted. By what percentage wil operating income increase for each process Process 1 130 % Process 2 46 96 What will be the increase in operating income for each system? Round your answers to the nearest collar. Process 1 1,777,061 X Process 2 537,600 x What will be the total operating income for each process? Round your intermediate calculations and final answers to the nearest dollar. Use the rounced answers in subsequent calcul 1777061 X Process 1 Process 2 537,600 x 3. What if unit sales are 10 percent lower than budgeted? By what percentage wil operating income decrease for each process Oeck My Work All work saved Book Calculator Process 1 6.5 Process 2 2.3 . Suppose that sales are 20 percent higher than budgeted. By what percentage will operating income increase for each process? Process 1 130 % Process 2 46 % What will be the increase in operating income for each system? Round your answers to the nearest dollar. Process 1 1,777,061 x Process 2 537,600 x What will be the total operating income for each process? Round your intermediate calculations and final answers to the nearest dollar. Use the rounded answers in subseq Process 1 1777061 X Process 2 537,600 X 3. What If unit sales are 10 percent lower than budgeted?py what percentage will operating income decrease for each process? Process 1 % Process 2 % What will be the total operating income for each process? Round your answers to the nearest dollar. Process 1 Process 2 7 Cho My Work 1. Operating leverage is concerned with the relative mix of fixed costs and variable costs in an organization. It is sometimes possible to trade off fixed costs for variable making the contribution of each unit sold that much greater. The mix of costs that an organization cheous can have a considerable influence on its operating risk and p 2. & 3. The degree of operating leverage is part of the calculation ssignment/kessignmentMain.doFinvokerStakeAssignmentSessionLocatorinprogress-false Degree of Operating Leverage. Percent Change in Profit Ringmith Company is considering two different processes to make its product-process and process 2. Process 1 requires Ringsmith to manufacture subcomponents of the product in-house. As a result, materials are less expensive overhead is higher. Process involves purchasing a subcomponents from outside suppliers. The direct materials costs are higher, but foved factory overhead is considerably lower. Relevant data for a sales level of 28,000 units follow: Process 1 Process 2 Sales $7,056,000 57,056,000 V expenses 2,604 000 4,168,000 Contribution margin 14.452.000 $2,688.000 Lested expenses 3.766,515 1,523.910 Opening income $683,485 51,164,00 Uniting price Unit variable 593 5156 Unit contion margin Required: 1. Compute the degree of cering verge for each process. Round your owerste del paese the rounded answers in subsequent cations Process Process 2. Support that sales are 20 percent higher than buty what percentage wiring an increase the What will be the for each Bound your answer to the nearest Preces 1.77.6 x cent Change in Prohit Ringsmith Company is considering two different processes to make its product-pronss 1 and process 2. Process 1 requires Ringsmith to manufacture subcomponents of the p overhead is higher. Process 2 involves purchasing all subcomponents from outside suppliers. The direct materials costs are higher, but fixed factory overhead is considerably lo Process 1 Process 2 $7,056,000 4,368,000 Sales Variable expenses Contribution margin Less total fixed expenses Operating income Unit selling price Unit variable cost Unit contribution margin Required: $7,056,000 2,604,000 $4,452,000 3,768,515 $683,485 $2,688,000 1,523,910 $1,164,090 5252 $93 $252 $156 $96 $159 1. Compute the degree of operating leverage for each process. Round your answers to one decimal place. Use the rounded answers in subsequent calculations Process 1 6.5 I Process 2 2.3 2. Suppose that sales are 20 percent higher than budgeted. By what percentage wil operating income increase for each process Process 1 130 % Process 2 46 96 What will be the increase in operating income for each system? Round your answers to the nearest collar. Process 1 1,777,061 X Process 2 537,600 x What will be the total operating income for each process? Round your intermediate calculations and final answers to the nearest dollar. Use the rounced answers in subsequent calcul 1777061 X Process 1 Process 2 537,600 x 3. What if unit sales are 10 percent lower than budgeted? By what percentage wil operating income decrease for each process Oeck My Work All work saved Book Calculator Process 1 6.5 Process 2 2.3 . Suppose that sales are 20 percent higher than budgeted. By what percentage will operating income increase for each process? Process 1 130 % Process 2 46 % What will be the increase in operating income for each system? Round your answers to the nearest dollar. Process 1 1,777,061 x Process 2 537,600 x What will be the total operating income for each process? Round your intermediate calculations and final answers to the nearest dollar. Use the rounded answers in subseq Process 1 1777061 X Process 2 537,600 X 3. What If unit sales are 10 percent lower than budgeted?py what percentage will operating income decrease for each process? Process 1 % Process 2 % What will be the total operating income for each process? Round your answers to the nearest dollar. Process 1 Process 2 7 Cho My Work 1. Operating leverage is concerned with the relative mix of fixed costs and variable costs in an organization. It is sometimes possible to trade off fixed costs for variable making the contribution of each unit sold that much greater. The mix of costs that an organization cheous can have a considerable influence on its operating risk and p 2. & 3. The degree of operating leverage is part of the calculation