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Carver Packing Company reports a total contribution margin of $58,560 and pre-tax net income of $24,400 for the current month. In the next month, the company expects sales volume to increase by 5%. The degree of operating leverage and the expected percent change in income, respectively, are: a. 2.5 and 13% b. 0.42 and 5% c. 0.42 and 2.2% d. 2.4 and 5% e. 2.4 and 12%

Carver Packing Company reports a total contribution margin of $58,560 and pre-tax net income of $24,400 for the current month. In the next month, the company expects sales volume to increase by 5%. The degree of operating leverage and the expected percent change in income, respectively, are: a. 2.5 and 13% b. 0.42 and 5% c. 0.42 and 2.2% d. 2.4 and 5% e. 2.4 and 12%

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Carver Packing Company reports a total contribution margin of $58,560 and pre-tax net income of $24,400 for the current month. In the next month, the company expects sales volume to increase by 5%. The degree of operating leverage and the expected percent change in income, respectively, are: a. 2.5 and 13% b. 0.42 and 5% c. 0.42 and 2.2% d. 2.4 and 5% e. 2.4 and 12%
Transcribed Image Text:Carver Packing Company reports a total contribution margin of $58,560 and pre-tax net income of $24,400 for the current month. In the next month, the company expects sales volume to increase by 5%. The degree of operating leverage and the expected percent change in income, respectively, are: a. 2.5 and 13% b. 0.42 and 5% c. 0.42 and 2.2% d. 2.4 and 5% e. 2.4 and 12%
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