SXF sells its single product for $14 per unit, and its variable cost per unit is $4. Total fixed costs are $800. Its CVP graph is as follows: If SXF increases its volume of sales by 10%, what will happen to its degree of operating leverage?
A) It will decrease
B) It will increase
C) It will stay the same
D) Cannot be determined

Question

SXF sells its single product for $14 per unit, and its variable cost per unit is $4. Total fixed costs are $800. Its CVP graph is as follows:  If SXF increases its volume of sales by 10%, what will happen to its degree of operating leverage?
A) It will decrease 
B) It will increase 
C) It will stay the same 
D) Cannot be determined

Quizplus · Accepted Answer

The Answer of SXF sells its single product for $14 per unit, and its variable cost per unit is $4. Total fixed costs are $800. Its CVP graph is as follows:  If SXF increases its volume of sales by 10%, what will happen to its degree of operating leverage?
A) It will decrease 
B) It will increase 
C) It will stay the same 
D) Cannot be determined

SXF Sells Its Single Product for $14 Per Unit, and Its