Please do not give solution in image format thanku Engberg Company installs lawn sod in home yards. The company's most recent monthly contribution format income statement follows:SalesVariable expensesContribution marginFixed expensesNet operating incomeAmount$ 134,00053,60080,40018,000$62,400Percent ofSales100%40%60%Required:1. What is the company's degree of operating leverage? (Round to two decimal places.)2. Using the degree of operating leverage, estimate the percentage increase in net operating income if there is a 20% increase in unitsales. (Enter the percentage as a whole number with two decimal places, i.e., 40.25.)3. Construct a new contribution format income statement for the company assuming a 20% increase in unit sales.

The operating leverage is calculated as the contribution margin divided by operating income. The…

Answered: Engberg Company installs lawn sod in…

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter3: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 4PB: West Island distributes a single product. The companys sales and expenses for the month of June are...

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S Engberg Company installs lawn sod in home yards. The company's most recent monthly contribution format income statement follows: Percent of Sales 100% 40% 60% Sales Variable expenses Contribution margin Amount $ 123,000 49, 200 73,800 Fixed expenses 17,000 Net operating income $ 56,800 Required: 1. What is the company's degree of operating leverage? (Round to two decimal places.) 2. Using the degree of operating leverage, estimate the percentage increase in net operating income if there is a 17% increase in unit sales. (Enter the percentage as a whole number with two decimal places, i.e., 40.25.) 3. Construct a new contribution format income statement for the company assuming a 17% increase in unit sales. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 What is the company's degree of operating leverage? (Round your answer to 2 decimal places.) Degree of operating leverage
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