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Operating leverage factor

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Reference no: EM133216211

Fixed Costs: $10 billion

Variable Costs: $30 billion (includes 100% of SG&A)

SG&A: $5 billion

Net Income: $5 billion

If 80% of SG&A costs were reclassified as fixed, what is the company's new operating leverage factor?

The company's Operating Leverage Factor before reclassification was 3.0.

Reference no: EM133216211

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