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Vicki sells authentic Amish quilts on her website. Suppose Vicki expects to sell 1,000 quilts during the coming year. Her average sales price per quilt

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Vicki sells authentic Amish quilts on her website. Suppose Vicki expects to sell 1,000 quilts during the coming year. Her average sales price per quilt is $250, and her average cost per quilt is $150. Her fixed expenses total $50,000. Compute Vicki's operating leverage factor at an expected sales level of 1,000 quilts. If sales volume increases 20%, by what percentage will her operating income change? Prove your answer by calculating operating income at a sales volume of 1,000 and at a sales volume of 1,200. Total contribution margin $ 100,000 50,000 Less: Fixed expenses $ 50,000 Operating income Prove your answer. (Round the percentage to the nearest tenth percent, X.X%.) Original volume (quilts) Add: Increase in volume New volume (quilts) Multiplied by: Unit contribution margin New total contribution margin Less: Fixed expenses New operating income Less: Operating income before change in volume Increase in operating income Percentage change %

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