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The following sales and cost data (in thousands) are for two companies in the transportation industry: Required: 1-a. Calculate the degree of operating leverage (DOL)
The following sales and cost data (in thousands) are for two companies in the transportation industry: Required: 1-a. Calculate the degree of operating leverage (DOL) for each company. 1-b. If sales increase from the present level, which company benefits more? 2. Assume that sales rise 10% in the next year but that everything else remains constant. Calculate the percentage increase in profit for each company. Complete this question by entering your answers in the tabs below. Calculate the degree of operating leverage (DOL) for each company. (Round your answers to 3 decimal places.) Complete this question by entering your answers in the tabs below. If sales increase from the present level, which company benefits more? Complete this question by entering your answers in the tabs below. Assume that sales rise 10% in the next year but that everything else remains constant. Calculate the percentage increase in profit for each company. (Input your answers as percentages rounded to 2 decimal places (i.e., 0.1567=15.67% ).)
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