TABLE 12-2 How Operating Leverage Affects EBIT: An Increase in Pierce Grain Company's Sales Base Sales Forecast Sales Item Level, t Level, t + 1 Percentage Change Sales $300,000 $368,000? +20% Less: Total variable costs 180,000 215.000 ? 180,000 * 1.28 Revenue before fixed costs $120,000 $140000 Less Total fixed costs 100.000 100.000 ? EBIT $ 20.000 $ 44,900 ? +120% Sales OL = % change EBIT/ % change = 129% / 20% = 600