Please provide the solution to this general accounting question using proper accounting principles. Given the following income statement for Matrix Electronics Company, compute the degreeof operating leverage (DOL):MATRIX ELECTRONICS COMPANYIncome StatementFor The Year Ended December 31, 2022ParticularsSales (25,000 units @ $120)Amount ($)$3,000,000Less: Variable costs (25,000 units @ $72) (1,800,000)Contribution Margin$1,200,000Less: Fixed costs(450,000)EBIT$750,000Less: Interest expense(75,000)EBT$675,000Less: Income tax expense (30%)(202,500)EAT$472,500Calculate the Degree of Operating Leverage (DOL)

Step 1: Detailed Explanation of DOLThe DOL measures the percentage change in EBIT that results from…

Answered: Given the following income statement…

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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Operating leverage Haywood Co. reports the following data: Line Item Description Amount Sales $6,160,000 Variable costs (4,620,000) Contribution margin $1,540,000 Fixed costs (440,000) Operating income $1,100,000 Determine Haywood Co.’s operating leverage. Round your answer to one decimal place.
Calculate Dol solution general accounting question
Operating Leverage Haywood Co. reports the following data: Sales $6,160,000 Variable costs (4,620,000) Contribution margin $1,540,000 Fixed costs (440,000) Operating income $1,100,000 Determine Haywood Co.’s operating leverage. Round your answer to one decimal place.
The following CVP income statements are available for Wildhorse Corp. and Blossom, Inc. Wildhorse Corp. Blossom, Inc. Sales revenue $854,000 $854,000 * Variable costs 396,500 228,750 Contribution margin 457,500 625,250 Fixed costs 305,000 472,750 Net income $152,500 $152,500 (a) Compute the degree of operating leverage for each company. (Round answers to 1 decimal place, e.g. 15.5.) Degree of Operating Leverage Wildhorse Blossom
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The single-column CVP income statements shown below are available for Wildhorse Company and Blossom Company, Sales Variable costs Contribution margin Fixed costs Net income Wildhorse Wildhorse Co. Blossom $495,000 239,000 256,000 1000 156,000 $100,000 Blossom Co. Degree of Operating Leverage $495,000 (a1) Compute the degree of operating leverage for each company. (Round answers to 2 decimal places, e.g. 1.15.) $ 51,000 444,000 344,000 $100,000 (b) Assuming that sales revenue increases by 10% (due to a 10% increase in the number of units sold), prepare a single-plumn CVP income statement for each company. Wildhorse Company $ tA $ Blossom Company
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Compute the operating leverage for each company

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