Engberg Company installs lawn sod in home yards. The company's most recent monthly contribution format income...
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Engberg Company installs lawn sod in home yards. The company's most recent monthly contribution format income statement follows: Sales Variable expenses Contribution margin Fixed expenses Net operating income. Amount $ 141,000 56,400 84,600 24,000 $ 60,600 Percent of Sales 100% 40% 60% Required: 1. What is the company's degree of operating leverage? 2. Using the degree of operating leverage, estimate the impact on net operating income of a 16% increase in unit sales. 3. Construct a new contribution format income statement for the company assuming a 16% increase in unit sales. Required 1 Complete this question by entering your answers in the tabs below. Required 2 Required 3 What is the company's degree of operating leverage? (Round your answer to 2 decimal places.) Degree of operating leverage < Required 1 Required 2 > Required 1 Required 2 Required 3 Using the degree of operating leverage, estimate the impact on net operating income of a 16% increase in unit sales. (Round your intermediate calculations to 2 decimal places. Round your percentage answer to 2 decimal places (i.e.1234 should be entered as 12.34).) Net operating income by < Required 1 % Required 3 > Required 1 Required 2 Required 3 Construct a new contribution format income statement for the company assuming a 16% increase in unit sales. Engberg Company Contribution Income Statement Amount Percent of Sales % % % < Required 2 Required 3 > Engberg Company installs lawn sod in home yards. The company's most recent monthly contribution format income statement follows: Sales Variable expenses Contribution margin Fixed expenses Net operating income. Amount $ 141,000 56,400 84,600 24,000 $ 60,600 Percent of Sales 100% 40% 60% Required: 1. What is the company's degree of operating leverage? 2. Using the degree of operating leverage, estimate the impact on net operating income of a 16% increase in unit sales. 3. Construct a new contribution format income statement for the company assuming a 16% increase in unit sales. Required 1 Complete this question by entering your answers in the tabs below. Required 2 Required 3 What is the company's degree of operating leverage? (Round your answer to 2 decimal places.) Degree of operating leverage < Required 1 Required 2 > Required 1 Required 2 Required 3 Using the degree of operating leverage, estimate the impact on net operating income of a 16% increase in unit sales. (Round your intermediate calculations to 2 decimal places. Round your percentage answer to 2 decimal places (i.e.1234 should be entered as 12.34).) Net operating income by < Required 1 % Required 3 > Required 1 Required 2 Required 3 Construct a new contribution format income statement for the company assuming a 16% increase in unit sales. Engberg Company Contribution Income Statement Amount Percent of Sales % % % < Required 2 Required 3 >
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Related Book For
Managerial Accounting
ISBN: 978-0697789938
13th Edition
Authors: Ray H. Garrison, Eric W. Noreen, Peter C. Brewer
Posted Date:
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