The following income statement was drawn from the records of Benson Company, a merchandising firm:

BENSON COMPANY

Income Statement

For the Year Ended December $31,$ Year $1$

Required

a$.$ Reconstruct the income statement using the contribution margin format.

b$.$ Calculate the magnitude of operating leverage.

c$.$ Use the measure of operating leverage to determine the amount of net income Benson will earn if sales increase by $10$ percent.