If the contribution margin ratio is 0.60, targeted operating income is $100,000, and targeted sales volume...
If the contribution margin ratio is 0.60, targeted operating income is $100,000, and targeted sales volume in dollars is $500,000, then the degree of operating leverage is ________.
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3.00 times |
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0.67 times |
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0.33 times |
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2.00 times |
Homework Answers
Contribution margin
= 500,000 * 0.60 = 300,000
Operating income = 100,000
Degree of operating leverage = Contribution margin/Operating income
= 300,000/100,000
= 3 times
Option A is the answer
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