What is the degree of opereting leverage? General accounting Oslo Company prepared the following contribution format incomestatement based on a sales volume of 1,000 units (the relevantrange of production is 500 units to 1,500 units):SalesVariable expenses$22,40012,800Contribution margin 9,600Fixed expenses7,968Net operating income $1,632What is the degree of operating leverage?

The degree of operating leverage (DOL) can be calculated using the following formula: DOL =…

Answered: Oslo Company prepared the following…

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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Required information [The following information applies to the questions displayed below.] 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 $ 10,000 5,500 Variable expenses Contribution margin Fixed expenses 4,500 2,250 Net operating income $4 2,250 4. If sales increase to 1,001 units, what would be the increase in net operating income? (Round your answer to 2 decimal places.) Increase in net operating income
Required information [The following information applies to the questions displayed below.] 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): $ 45,000 31,500 13,500 Sales Variable expenses Contribution margin Fixed expenses 8,640 Net operating income $ 4,860 13. 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.) Increase in net operating income |%
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 $ 15,000 9,000 6,000 3,120 Net operating income $2,880 4. If sales increase to 1,001 units, what would be the increase in net operating income? (Round your answer to 2 decimal places.) Increase in net operating income
What is the degree of operating leverage for general accounting?
Required Information [The following information applies to the questions displayed below] 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 $ 65,000 45,500 19,500 14,048 $5,460 13. Using the degree of operating leverage, what is the estimated percent increase in net operating income that would result from a 5% increase in unit sales? (Round your Intermediate calculations and final answer to 2 decimal places) increase in n openssting income
Required information [The following information applies to the questions displayed below.] 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 $ 80,000 52,000 28,000 21,840 $ 6,160 Required: 4. If sales increase to 1,001 units, what would be the increase in net operating income? Note: Round your answer to 2 decimal places. Increase in net operating income
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 $ 15,000 9,000 6,000 3,120 $ 2,880 Net operating income 2. What is the contribution margin ratio? Contribution margin ratio
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$ 55,000Variable expenses33,000Contribution margin22,000Fixed expenses14,960Net operating income$ 7,04015. 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 $14,960 and the total fixed expenses are $33,000. 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.)
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 $ 15,000 9,000 6,000 3,120 Net operating income $ 2,880 12. What is the degree of operating leverage? (Round your answer to 2 decimal places.) Degree of operating leverage
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The following income statement applies to Finch Company for the current year: Income Statement Sales revenue (480 units × $30) $ 14,400 Variable cost (480 units × $15) (7,200 ) Contribution margin 7,200 Fixed cost (4,000 ) Net income $ 3,200 Required a. Use the contribution margin approach to calculate the magnitude of operating leverage. b. Use the operating leverage measure computed in Requirement a to determine the amount of net income that Finch
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