Answered: Pine crest Technologies has an…

Pine crest Technologies has an operating leverage of 6.2. If the company's sales increase by 15%, its net operating income should increase by approximately: A) 93.0% B) 6.2% C) 15.0% D) 93.0%

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter3: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 22MC: If a firm has a contribution margin of $59,690 and a net income of $12,700 for the current month,...

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Question

Can you provide a detailed solution to this financial accounting problem using proper principles?

Pine crest Technologies has an operating leverage of 6.2. If the company's sales
increase by 15%, its net operating income should increase by approximately:
A) 93.0%
B) 6.2%
C) 15.0%
D) 93.0%

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