what is the degree of operating leverage dol 
the degree of operating leverage dol is a multiple that measures how much the operating income of a company will change in response to a change in sales companies with a large proportion of fixed costs or costs that don t change with production to variable costs costs that change with production volume have higher levels of operating leverage 1the dol ratio assists analysts in determining the impact of any change in sales on company earnings or profit formula and calculation of degree of operating leverage d o l change in e b i t change in sales where e b i t earnings before income and taxes begin aligned dol frac text change in ebit text change in sales textbf where ebit text earnings before income and taxes end aligned dol change in sales change in ebit where ebit earnings before income and taxes there are a number of alternative ways to calculate the dol each based on the primary formula given above degree of operating leverage change in operating income changes in sales text degree of operating leverage frac text change in operating income text changes in sales degree of operating leverage changes in saleschange in operating income degree of operating leverage contribution margin operating income text degree of operating leverage frac text contribution margin text operating income degree of operating leverage operating incomecontribution margin degree of operating leverage sales variable costs sales variable costs fixed costs text degree of operating leverage frac text sales variable costs text sales variable costs fixed costs degree of operating leverage sales variable costs fixed costssales variable costs degree of operating leverage contribution margin percentage operating margin text degree of operating leverage frac text contribution margin percentage text operating margin degree of operating leverage operating margincontribution margin percentage investopedia candra huff