Exercise 6-9 Compute and Use the Degree of Operating Leverage (LO6-8) Engberg Company installs lawn sod in home yards. The company's most recent monthly contribution format income statement follows: Percent of Sales 188 48% 604 Amount $ 128,000 51,200 76,800 20,000 $ 56,800 Sales Variable expenses Contribution margin Fixed expenses Net operating income 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 25% increase in sales. 3. Construct a new contribution format income statement for the company assuming a 25% increase in sales. Complete this question by entering your answers in the tabs below. RequiredRequired 2 Required 3 What is the company's degree of operating leverage? (Round your answer to 2 decimal places Degree of operating leverage Required 2 > 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 25% increase in sales. 3. Construct a new contribution format income statement for the company assuming a 25% increase in sales. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Using the degree of operating leverage, estimate the impact on net operating income of a 25% Increase in sales. (Do not round Intermediate calculations. Round your percentage answer to 2 decimal places (1.e 0.1234 should be entered as 12.34).) Net operating income % by 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 25% increase in sales. 3. Construct a new contribution format income statement for the company assuming a 25% increase in sales. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Construct a new contribution format Income statement for the company assuming a 25% Increase in sales. Engberg Company Contribution Income Statement Amount Percent of Sales % % %