14. Assume that the amounts of the company's total variable expenses and total fixed expenses were reversed. In other words, assume that the total variable expenses are $8,640 and the total fixed expenses are $31,500. Under this scenario and assuming that total sales remain the same, what is the degree of operating leverage? (Round your answer to 2 decimal places.)
14. Assume that the amounts of the company's total variable expenses and total fixed expenses were reversed. In other words, assume that the total variable expenses are $8,640 and the total fixed expenses are $31,500. Under this scenario and assuming that total sales remain the same, what is the degree of operating leverage? (Round your answer to 2 decimal places.)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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![Required information
[The following information applies to the questions displayed below.]
Oslo Company prepared the following contribution format income statement based on a sales volume of 1,000 units (the
relevant range of production is 500 units to 1,500 units):
Sales
Variable expenses
$ 45,000
31,500
Contribution margin
Fixed expenses
13,500
8,640
Net operating income
4,860
14. Assume that the amounts of the company's total variable expenses and total fixed expenses were reversed. In other words, assume
that the total variable expenses are $8,640 and the total fixed expenses are $31,500. Under this scenario and assuming that total sales
remain the same, what is the degree of operating leverage? (Round your answer to 2 decimal places.)
Degree of operating leverage](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F21d2411b-c4eb-4e7c-9735-0f7d428495aa%2Fd8b05fe2-527f-4840-bb24-b78bd69baed1%2Fhaazsnf_processed.png&w=3840&q=75)
Transcribed Image Text:Required information
[The following information applies to the questions displayed below.]
Oslo Company prepared the following contribution format income statement based on a sales volume of 1,000 units (the
relevant range of production is 500 units to 1,500 units):
Sales
Variable expenses
$ 45,000
31,500
Contribution margin
Fixed expenses
13,500
8,640
Net operating income
4,860
14. Assume that the amounts of the company's total variable expenses and total fixed expenses were reversed. In other words, assume
that the total variable expenses are $8,640 and the total fixed expenses are $31,500. Under this scenario and assuming that total sales
remain the same, what is the degree of operating leverage? (Round your answer to 2 decimal places.)
Degree of operating leverage
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