Jackson Corp. has a degree of operating leverage of 4.5. If sales increase by 10%, by how much should operating income increase? a. 15.0% b. 35.0% c. 45.0% d. 25.0%

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,...
icon
Related questions
Question

Financial Accounting

Jackson Corp. has a degree of operating leverage of 4.5. If sales
increase by 10%, by how much should operating income increase?
a. 15.0%
b. 35.0%
c. 45.0%
d. 25.0%
Transcribed Image Text:Jackson Corp. has a degree of operating leverage of 4.5. If sales increase by 10%, by how much should operating income increase? a. 15.0% b. 35.0% c. 45.0% d. 25.0%
Expert Solution
steps

Step by step

Solved in 2 steps

Blurred answer
Recommended textbooks for you
Principles of Accounting Volume 2
Principles of Accounting Volume 2
Accounting
ISBN:
9781947172609
Author:
OpenStax
Publisher:
OpenStax College
Managerial Accounting
Managerial Accounting
Accounting
ISBN:
9781337912020
Author:
Carl Warren, Ph.d. Cma William B. Tayler
Publisher:
South-Western College Pub
EBK CONTEMPORARY FINANCIAL MANAGEMENT
EBK CONTEMPORARY FINANCIAL MANAGEMENT
Finance
ISBN:
9781337514835
Author:
MOYER
Publisher:
CENGAGE LEARNING - CONSIGNMENT
Intermediate Financial Management (MindTap Course…
Intermediate Financial Management (MindTap Course…
Finance
ISBN:
9781337395083
Author:
Eugene F. Brigham, Phillip R. Daves
Publisher:
Cengage Learning