With regards to Operating Leverage, explain why a company with HIGH Operating Leverage faces greater financial risk in a declining sales period compared to a company with LOW Operating Leverage. (HINT: The key here is the relationship between fixed costs and variable costs.)

What does a business's Contribution Margin represent?

What does the Contribution Margin have to do with Operating Leverage?

Answer rating: 100% (QA)

Operating Leverage and Contribution Margin According to Brewer Garrison Noreen 2019 operating leverage is basically a costaccounting metric used to examine the degree to which a project or an organiza... View the full answer