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Brandi's Bakery's Income Statement for Last Month Is Given Below

Question 120

Multiple Choice

Brandi's Bakery's income statement for last month is given below.What is Brandi's degree of operating leverage?
 Sales $250,000 Variable expenses 75,000 Contribution margin 175,000 Fixed expenses 125,000 Operating income $50,000\begin{array}{lr}\text { Sales } & \$ 250,000 \\\text { Variable expenses } & \underline{75,000} \\\text { Contribution margin } & 175,000 \\\text { Fixed expenses } & \underline{125,000} \\\text { Operating income } & \underline{\underline{\$ 50,000}}\end{array}


A) 0.2
B) 1.4
C) 3.5
D) 5.0

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