Use the contribution margin approach to calculate the magnitude of operating leverage.
Use the operating leverage measure computed in Requirement a to determine the amount of net income that Stuart Company will earn if it experiences a 10 percent increase in revenue. The sales price per unit is not affected.
Verify your answer to Requirement b by constructing an income statement based on a 10 per- cent increase in sales revenue. The sales price is not affected. Calculate the percentage change in net income for the two income statements.
The following income statement applies to Cohen Company for the current year.
chapter 8 comprehensive problem. HELP SOON PLEASE.