Felipe Enterprises reports the following data: Sales $330,000 Variable costs 140,000 Contribution margin $190,000 Fixed costs 95,000 Income from operations $95,000 Determine Felipe Enterprises’s operating leverage.

Felipe Enterprises reports the following data: Sales $330,000 Variable costs 140,000 Contribution margin $190,000 Fixed costs 95,000 Income from operations $95,000 Determine Felipe Enterprises’s operating leverage.

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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Question

Operating Leverage

Felipe Enterprises reports the following data:

Sales	$330,000
Variable costs	140,000

Contribution margin	$190,000
Fixed costs	95,000

Income from operations

$95,000

Determine Felipe Enterprises’s operating leverage.

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