3. Construct a new contribution format income statement for the company assuming a 18% increase in sales.

Engberg Company installs lawn sod in home yards. The company's most recent monthly contribution format income statement follows: Percent of Sales 100% 40% 60% Amount $ 132,000 52,800 79,200 20,000 $ 59,200 Sales Variable expenses Contribution margin Fixed expenses Net operating income Required: 1. Compute the company's degree of operating leverage. (Round your answer to 2 decimal places.) Degree of operating leverage 2. Using the degree of operating leverage, estimate the impact on net operating income of a 18% increase in sales. (Round your intermediate calculations to 2 decimal places. Round your percentage answer to 2 decimal places (.e.1234 should be entered as 12.34).) Net operating income by