Question

16 Required information [The following information applies to the questions displayed below) Oslo Company prepared the following contribution format income statement based on a sales volume of 1.000 units (the relevant range of production is 500 units to 1,500 units): Part 15 of 15 Sales Variable expenses Contribution margin Fixed expenses Net operating income $ 65, eee 45. See 19.se points Skipped $ 5,460 15. Assume that the amounts of the company's total variable expenses and total fixed expenses were reversed. In other words, assume that the total variable expenses are $14.040 and the total fixed expenses are $45,500. Given this scenario and assuming that total sales remain the same. Using the degree of calculated operating leverage, what is the estimated percent increase in net operating income of a 5% increase in sales? (Round your intermediate calculations and final answer to 2 decimal places.) Increase in net operating income

Answer 1

17
1
	High Low Method:	Occupancy Days	Cost
	High Level	4,410	12,998
	Low Level	650	2,470
	Differential	3,760	10,528
	Variable Cost of Electricity:
A	Difference in Cost	10,528
B	Difference in Occupancy Days	3,760
A/B	Variable Cost of Electricity	2.80
	Total Cost at 4410 Occu Days:
	Total Cost	12,998
	Less: Variable Cost (4410*2.80)	12,348
	Fixed Cost	650
2	a

pLEASE RAISE SEPARATE Q FOR OTHER PROBLEM