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Green Enterprises' variable expenses are 30% of sales. The company has monthly fixed expenses of $18,000 and a monthly target operating income of $6,000. What is Green Enterprises' operating leverage factor at the target level of operating income? A) 4.00 B) 1.25 C) 2.50 D) 3.00

Green Enterprises' variable expenses are 30% of sales. The company has monthly fixed expenses of $18,000 and a monthly target operating income of $6,000. What is Green Enterprises' operating leverage factor at the target level of operating income? A) 4.00 B) 1.25 C) 2.50 D) 3.00

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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Green Enterprises' variable expenses are 30% of sales. The company has monthly fixed expenses of $18,000 and a monthly target operating income of $6,000. What is Green Enterprises' operating leverage factor at the target level of operating income? A) 4.00 B) 1.25 C) 2.50 D) 3.00
Transcribed Image Text:Green Enterprises' variable expenses are 30% of sales. The company has monthly fixed expenses of $18,000 and a monthly target operating income of $6,000. What is Green Enterprises' operating leverage factor at the target level of operating income? A) 4.00 B) 1.25 C) 2.50 D) 3.00
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