The CVP income statements shown below are available for AX Company and ZY Company at the beginning of

2020 . Instructions :

Determine the degree of operating leverage for each company.

\begin{tabular}{|l|c|c|} \hline & AX Company & ZY Company \\ \hline Sales & $500,000 & $500,000 \\ \hline Variable Costs & $110,000 & $10,000 \\ \hline Contribution Margin & $390,000 & $490,000 \\ \hline Fixed Costs & $100,000 & $200,000 \\ \hline Net Income & $290,000 & $290,000 \\ \hline \end{tabular}