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Engberg Company installs lawn sod in home yards. The companys most recent monthly contribution format...

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Accounting

Engberg Company installs lawn sod in home yards. The companys most recent monthly contribution format income statement follows: Amount Percent of Sales Sales $ 96,000 100% Variable expenses 38,400 40% Contribution margin 57,600 60% Fixed expenses 44,160 Net operating income $ 13,440 Required: What is the companys degree of operating leverage? Using the degree of operating leverage, estimate the impact on net operating income of a 7% increase in unit sales. Construct a new contribution format income statement for the company assuming a 7% increase in unit sales

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