Give me perfect answer with explanation.h Engberg Company installs lawn sod in home yards. The company's most recent monthly contribution format income statement follows:Percent ofSales100%40%60%SalesVariable expensesContribution marginFixed expensesNet operating incomeAmount$ 90,00036,00054,00041,400$ 12,600Required: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 7% increase in unit sales.3. Construct a new contribution format income statement for the company assuming a 7% increase in unit sales.

a matrix used by businesses that calculates the impact on a firm's income because of the change in…

Answered: 1. What is the company's degree of…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

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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 7% increase in unit sales. 3. Construct a new contribution format income statement for the company assuming a 7% increase in unit sales.