Patton Company's selling price is $100, variable costs are 60% of sales, and fixed costs total $60,000.
Required:
a.At a $400,000 sales level, what is Patton's degree of operating leverage?
b.If sales volume increases by 10%, what will be the amount of increase in operating income?

Question

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The Answer of Patton Company's selling price is $100, variable costs are 60% of sales, and fixed costs total $60,000.
Required:
a.At a $400,000 sales level, what is Patton's degree of operating leverage?
b.If sales volume increases by 10%, what will be the amount of increase in operating income?

Patton Company's Selling Price Is $100, Variable Costs Are 60