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Taco Rey Restaurant had the following information available related to its operations from last year: Sales (153,000 units) $580,000. Variable costs 180,000. Contribution margin $400,000.

Taco Rey Restaurant had the following information available related to its operations from last year: Sales (153,000 units) $580,000. Variable costs 180,000. Contribution margin $400,000. Fixed costs 130,000. Net operating income $270,000.

A. What is Taco Rey's operating leverage? If required, round your answer to two decimal places.

B. If sales increased by 30 percent, what would Taco Rey's net operating income be? $

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