Oslo Company prepared the following contribution format income statement based on a sales volume of 1,000 units (the relevant range of production is 500 units to 1,500 units): Sales Variable expenses Contribution margin Fixed expenses Net operating income $ 45,000 31,500 13,500 8,640 $ 4,860 Increase in net operating income Check my work 15. Assume that the amounts of the company's total variable expenses and total fixed expenses were reversed. In other words, assume that the total variable expenses are $8,640 and the total fixed expenses are $31,500. Using the degree of operating leverage, what is the estimated percent increase in net operating income of a 5% increase in unit sales? (Round your intermediate calculations and final answer to 2 decimal places.) % 3
Oslo Company prepared the following contribution format income statement based on a sales volume of 1,000 units (the relevant range of production is 500 units to 1,500 units): Sales Variable expenses Contribution margin Fixed expenses Net operating income $ 45,000 31,500 13,500 8,640 $ 4,860 Increase in net operating income Check my work 15. Assume that the amounts of the company's total variable expenses and total fixed expenses were reversed. In other words, assume that the total variable expenses are $8,640 and the total fixed expenses are $31,500. Using the degree of operating leverage, what is the estimated percent increase in net operating income of a 5% increase in unit sales? (Round your intermediate calculations and final answer to 2 decimal places.) % 3
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Oslo Company prepared the following contribution format income statement based on a
sales volume of 1,000 units (the relevant range of production is 500 units to 1,500 units):
Sales
Variable expenses
Contribution margin
Fixed expenses
Net operating income
$ 45,000
31,500
13,500
8,640
$ 4,860
Increase in net operating income
subm
Check my work
15. Assume that the amounts of the company's total variable expenses and total fixed expenses were
reversed. In other words, assume that the total variable expenses are $8,640 and the total fixed expenses are
$31,500. Using the degree of operating leverage, what is the estimated percent increase in net operating
income of a 5% increase in unit sales? (Round your intermediate calculations and final answer to 2 decimal
places.)
%
3
200
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