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Alina’s Catering has a monthly target operating income of $16,000. Variable expenses are 40% of sales and monthly fixed expenses are $14,000. What is Alina’s operating leverage factor at the target level of operating income? a. 0.40 b. 2.67 c. 1.875 d. 0.63

Alina’s Catering has a monthly target operating income of $16,000. Variable expenses are 40% of sales and monthly fixed expenses are $14,000. What is Alina’s operating leverage factor at the target level of operating income? a. 0.40 b. 2.67 c. 1.875 d. 0.63

Cornerstones of Cost Management (Cornerstones Series)
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter16: Cost-volume-profit Analysis
Section: Chapter Questions
Problem 36P: Faldo Company produces a single product. The projected income statement for the coming year, based...
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Alina’s Catering has a monthly target operating income of $16,000. Variable expenses are 40% of sales and monthly fixed expenses are $14,000. What is Alina’s operating leverage factor at the target level of operating income? a. 0.40 b. 2.67 c. 1.875 d. 0.63

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