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Eneliko Company installs home theater systems The company’s most recent monthly contribution format income statement appears below Required Compute the company’s degree of

Eneliko Company installs home theater systems. The company’s most recent monthly contribution format income statement appears below:

 

 

Required:

1.       Compute the company’s degree of operating leverage.

2.       Using the degree of operating leverage, estimate the impact on net operating income of a 10% increase in sales.

3.       Verify your estimate from part (2) above by constructing a new contribution format income statement for the company assuming a 10% increase in sales.

Jul 01 2020 View more View Less

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