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Applying the degree of operating leverage concept

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Reference no: EM133040317

Use the following information: Tango Incorporated manufactures and sells a single product. The company's contribution format income statement projection for its next year of operations is:

Sales Revenue: 5,000 units sold $1,000,000

-Variable Expenses -750,000

Contribution Margin 250,000

-Fixed Expenses -225,000

Net Operating Income $ 25,000

-Applying the degree of operating leverage concept: how much will net operating income change as a percentage, if sales are 10% greater than projected? Fixed expenses will remain in the relevant range.

Group of answer choices

Plus 100%

10% X 10 = Plus 100%

Plus 10%

Plus 40%

Reference no: EM133040317

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