Compute the company's degree of operating leverage Edison Landscaping installs artificial turf in residential yards. Thecompany's most recent monthly contribution format incomestatement follows:Amount Percent of Sales$145,000 100%SalesVariable expenses58,000 40%Contribution margin87,00060%25,000Fixed expensesNet operating income 62,0001.Compute the company's degree of operating leverage.2.Using the degree of operating leverage, estimate the impact onnet operating income of a 12% increase in sales.

Explanation of Sales: Sales represents the total revenue generated by Edison Landscaping from…

Answered: Edison Landscaping installs artificial…

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter3: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 14EB: Company A has current sales of $4,000,000 and a 45% contribution margin. Its fixed costs are...

See similar textbooks

Similar questions

Give me answer general accounting
Engberg Company installs lawn sod in home yards. The company's most recent monthly contribution format income statement follows: Percent of Amount Sales Sales $ 134,000 53,600 100% Variable expenses 40% Contribution margin 80, 400 60% Fixed expenses 15, 000 $65,400 Net operating income Required: 1. What is the company's degree of operating leverage? 2. Using the degree of operating leveráge, estimate the impact on net operating income of a 12% increase in sales. 3. Construct a new contribution format income statement for the company assuming a 12% increase in sales. ces Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 What is the company's degree of operating leverage? (Round your answer to 2 decimal places.) Degree of operating leverage
Engberg Company installs lawn sod in home yards. The company's most recent monthly contribution format income statement follows: Percent of Sales 100% 40% 60% Sales Variable expenses Contribution margin Amount $ 86,000 34,400 51,600 Fixed expenses 41,280 Net operating income $ 10,320 Required: 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 8% increase in unit sales. 3. Construct a new contribution format income statement for the company assuming a 8% increase in unit sales. Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 What is the company's degree of operating leverage? (Round your answer to 2 decimal places) Degree of operating leverage 4.29 Required 2
Engberg Company installs lawn sod in home yards. The company's most recent monthly contribution format income statement follows: Percent of Sales 100% 40% 60% Sales Variable expenses Contribution margin Fixed expenses Net operating income Amount $ 82,000 32,800 49,200 38,540 $ 10,660 Required: 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 6% increase in unit sales. 3. Construct a new contribution format income statement for the company assuming a 6% increase in unit sales.
Given answer accounting questions
Engberg Company installs lawn sod in home yards. The company's most recent monthly contribution format income statement follows: Percent of Sales 100% Amount Sales $ 80,000 Variable expenses 32,000 40% Contribution margin 48,000 60% Fixed expenses 38,000 Net operating income $ 10,000 Required: 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 5% increase in unit sales. 3. Construct a new contribution format income statement for the company assuming a 5% increase in unit sales. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 What is the company's degree of operating leverage? (Round your answer to 1 decimal place.) Degree of operating leverage 4.8
Engberg Company installs lawn sod in home yards. The company’s most recent monthly contribution format income statement follows: Amount Percent of Sales Sales $ 134,000 100 % Variable expenses 53,600 40 % Contribution margin 80,400 60 % Fixed expenses 15,000 Net operating income $ 65,400 Required: 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 14% increase in sales. 3. Construct a new contribution format income statement for the company assuming a 14% increase in sales.
Subject : - Accounting
Engberg Company installs lawn sod in home yards. The company's most recent monthly contribution format income statement follows: Percent of Amount Sales Sales $ 134,000 53,600 100% Variable expenses 40% Contribution margin 80, 400 60% k Fixed expenses 15,000 Net operating income $65,400 nt Required: 1. What is the company's degree of operating leverage? 2. Using the degree of operating leveráge, estimate the impact on net operating income of a 12% increase in sales. 3. Construct a new contribution format income statement for the company assuming a 12% increase in sales. ences Complete this question by entering your answers in the tabs below. Required 1 Reqijired 2 Required 3 Using the degree of operating leverage, estimate the impact on net operating income of a 12% increase in sales. (Do not round intermediate calculations. Round your percentage answer to 2 decimal places (i.e 0.1234 should be entered as 12.34).) Net operating income by %
Engberg Company installs lawn sod in home yards. The company's most recent monthly contribution format income statement follows: Sales Variable expenses Contribution margin Fixed expenses Net operating income Amount $ 88,000 35,200 52,800 41,360 $ 11,440. Percent of Sales 100% 40% 60% Required: 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 6% increase in unit sales. 3. Construct a new contribution format income statement for the company assuming a 6% increase in unit sales.
Engberg Company installs lawn sod in home yards. The company’s most recent monthly contribution format income statement follows: Amount Percent of Sales Sales $ 84,000 100% Variable expenses 33,600 40% Contribution margin 50,400 60% Fixed expenses 40,320 Net operating income $ 10,080 Required: 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 an 8% increase in unit sales. 3. Construct a new contribution format income statement for the company assuming an 8% increase in unit sales. Required 1 Degree of operating leverage Required 2 & 3:see doc attached
S Engberg Company installs lawn sod in home yards. The company's most recent monthly contribution format income statement follows: Percent of Sales 100% 40% 60% Sales Variable expenses Contribution margin Amount $ 123,000 49, 200 73,800 Fixed expenses 17,000 Net operating income $ 56,800 Required: 1. What is the company's degree of operating leverage? (Round to two decimal places.) 2. Using the degree of operating leverage, estimate the percentage increase in net operating income if there is a 17% increase in unit sales. (Enter the percentage as a whole number with two decimal places, i.e., 40.25.) 3. Construct a new contribution format income statement for the company assuming a 17% increase in unit sales. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 What is the company's degree of operating leverage? (Round your answer to 2 decimal places.) Degree of operating leverage

SEE MORE QUESTIONS

Recommended textbooks for you

Principles of Accounting Volume 2

Accounting

ISBN:

9781947172609

Author:

OpenStax

Publisher:

OpenStax College

Principles of Accounting Volume 2

Accounting

ISBN:

9781947172609

Author:

OpenStax

Publisher:

OpenStax College

SEE MORE TEXTBOOKS