If sales are $450,000, variable costs are 75% of sales, and operating income is $35,000, what is the operating leverage? a. 2.500 b. 3.214 c. 4.875 d. 6.750

Principles of Accounting Volume 2
19th Edition
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax
Chapter3: Cost-volume-profit Analysis
Section: Chapter Questions
Problem 23MC: If a firm has a contribution margin of $78M90 and a net income of $13,700 for the current month,...
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Operating leverage??

If sales are $450,000, variable costs are 75% of sales, and
operating income is $35,000, what is the operating leverage?
a. 2.500
b. 3.214
c. 4.875
d. 6.750
Transcribed Image Text:If sales are $450,000, variable costs are 75% of sales, and operating income is $35,000, what is the operating leverage? a. 2.500 b. 3.214 c. 4.875 d. 6.750
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