E$6-4($Algo$)$ Analyzing Changes in Price, Cost Structure, Degree of Operating Leverage $[$LO $6-4,6-5]$

Cove$$s Cakes is a local bakery. Price and cost information follows:

Price per cake$ $13\mathrm{.}61$Variable cost per cake$$Ingredients$2\mathrm{.}16$Direct labor$1\mathrm{.}15$Overhead $($box$,$ etc.$)0\mathrm{.}16$Fixed costs per month$4,664\mathrm{.}40$

Required:

Calculate Cove$$s new break$-$even point under each of the following independent scenarios:

Sales price increases by $$1\mathrm{.}20$ per cake.Fixed costs increase by $$545$ per month.Variable costs decrease by $$0\mathrm{.}40$ per cake.Sales price decreases by $$0\mathrm{.}30$ per cake.

Assume that Cove sold $475$ cakes last month. Calculate the company$$s degree of operating leverage.

Using the degree of operating leverage, calculate the change in profit caused by a $12$ percent increase in sales revenue.