One of the products produced by ZOMG Co. is an exercise tracking app for smart phones that turns your running progress into a zombie survival narrative. The selling price per app is $4.50, and variable cost of production is $2.50. Total fixed costs per year are $316,600. The company is currently selling 200,000 apps per year. What is ZOMG'sdegree of operating leverage, and, if the company can increase sales in units and dollars by 30%, what will be its new operating income as a result?

Answer rating: 100% (QA)

To calculate ZOMG Cos degree of operating leverage and determine the new operating income if sales i... View the full answer