Last year Avator's operating income (EBIT) increased by 22% while its dollar sales increased by 15%. What is Avator's degree of operating leverage (DOL)?
A) 0.68
B) 2.0
C) 1.47
D) 0.32

Name: Last year Avator's operating income (EBIT) increased by 22% while its dollar sales increased by 15%. What is Avator's degree of operating leverage (DOL)? A) 0.68 B) 2.0 C) 1.47 D) 0.32
Brand: Quizplus
Rating: 4.8 (31 reviews)

Question

Quizplus · Accepted Answer

Degree of Operating Leverage (DOL) = % Change in EBIT / % Change in Sales
DOL = (22/15)
DOL = 1.47

Last Year Avator's Operating Income (EBIT) Increased by 22% While