Operating LeverageCartersville Co. reports the following data:Sales$455,200 Variable costs(250,400)Contribution margin$204,800 Fixed costs(146,300)Operating income$58,500 Determine Cartersville Co.’s operating leverage. Round your answer to one decimal place.

Operating leverage: It is the ratio that measures the proportion of fixed cost on the total costs…

Answered: Determine Cartersville Co.’s operating…

Business

Accounting

Determine Cartersville Co.’s operating leverage.

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter7: Variable Costing For Management analysis

Section: Chapter Questions

Problem 16E

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Question

Operating Leverage

Cartersville Co. reports the following data:

Sales	$455,200
Variable costs	(250,400)
Contribution margin	$204,800
Fixed costs	(146,300)
Operating income	$58,500

Determine Cartersville Co.’s operating leverage. Round your answer to one decimal place.

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