Please help me with correct answer thanku Engberg Company installs lawn sod inhome yards. The company's most recentmonthly contribution format incomestatement follows:SalesVariableexpensesContributionmarginFixedexpensesNet operatingincomeAmount$92,00036,80055,20041,400$13,800Percentof Sales100%4060%Required:1. What is the company's degree ofoperating leverage?2. Using the degree of operating leverage,estimate the impact on net operatingincome of a 5% increase in unit sales.3. Construct a new contribution formatincome statement for the companyassuming a 5% increase in unit sales.

Income statement :— It is one of the financial statement that shows profitability, total revenue and…

Engberg Company installs lawn sod in home yards. The company's most recent monthly contribution format income statement follows: Sales Variable expenses Contribution margin Fixed expenses Amount $ 92,000 36,800 55,200 41,400 Percent of Sales 100% 40 60%

Engberg Company installs lawn sod in home yards. The company's most recent monthly contribution format income statement follows: Sales Variable expenses Contribution margin Fixed expenses Amount $ 92,000 36,800 55,200 41,400 Percent of Sales 100% 40 60%

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter11: Differential Analysis And Product Pricing

Section: Chapter Questions

Problem 5E

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Please help me with correct answer thanku

Engberg Company installs lawn sod in
home yards. The company's most recent
monthly contribution format income
statement follows:
Sales
Variable
expenses
Contribution
margin
Fixed
expenses
Net operating
income
Amount
$
92,000
36,800
55,200
41,400
$
13,800
Percent
of Sales
100%
40
60%
Required:
1. What is the company's degree of
operating leverage?
2. Using the degree of operating leverage,
estimate the impact on net operating
income of a 5% increase in unit sales.
3. Construct a new contribution format
income statement for the company
assuming a 5% increase in unit sales.

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