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Knowledge Check 01 The measure of how sensitive net operating income is to...

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Accounting

Knowledge Check 01
The measure of how sensitive net operating income is to a given percentage change in volume sales is called _________blank.
multiple choice 1
risk leverage
operating leverage
sensitivity leverage
Knowledge Check 02
Sweet Berry Farm Corporations current sales are $500,000. The contribution margin is $300,000 and the net operating income is $100,000. What is the companys degree of operating leverage?
multiple choice 2
3.00
0.60
2.00
1.67
Knowledge Check 03
Latimer Corporation has sales of $500,000 and its contribution margin is $200,000. The company's degree of operating leverage is 2. If the company anticipates a 30% increase in sales, what is the percentage change in the company's net operating income?
multiple choice 3
60%
25%
30%
24%

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