The following income statement was drawn from the records of Horizon Manufacturing: Description Amount ($) Sales Revenue (12,500 x $95) $1,187,500 Cost of Goods Sold (12,500 x $48) ($600,000) Gross Margin $587,500 Sales Commissions (6% of Sales) ($71,250) Administrative Salaries Expense ($152,000) Marketing Expense ($96,500) Depreciation Expense ($87,750) Distribution Expenses (12,500 x $5)||($62,500) Net Income $117,500 Calculate the magnitude of operating leverage for Horizon Manufacturing.

The following income statement was drawn from the records of Horizon Manufacturing: Description Amount ($) Sales Revenue (12,500 x $95) $1,187,500 Cost of Goods Sold (12,500 x $48) ($600,000) Gross Margin $587,500 Sales Commissions (6% of Sales) ($71,250) Administrative Salaries Expense ($152,000) Marketing Expense ($96,500) Depreciation Expense ($87,750) Distribution Expenses (12,500 x $5)||($62,500) Net Income $117,500 Calculate the magnitude of operating leverage for Horizon Manufacturing.

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter12: Balanced Scorecard And Other Performance Measures

Section: Chapter Questions

Problem 6EA: During the current year, Sokowski Manufacturing earned income of $350,000 from total sales of...

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