Marcus Company has an operating leverage of 4.2. If the company experiences a sales decrease of 15%, what would be the approximate percentage change in net operating income? a. 4.2% b. 15% c. -63% d. -35.7%

Marcus Company has an operating leverage of 4.2. If the company experiences a sales decrease of 15%, what would be the approximate percentage change in net operating income? a. 4.2% b. 15% c. -63% d. -35.7%

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter16: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 21E: Income statements for two different companies in the same industry are as follows: Required: 1....

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Question

General accounting

Marcus Company has an operating leverage of 4.2. If the
company experiences a sales decrease of 15%, what would be the
approximate percentage change in net operating income?
a. 4.2%
b. 15%
c. -63%
d. -35.7%

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