The degree of operating leverage can be measured by ________.
A) dividing the contribution margin by operating income
B) dividing the fixed costs by the sales price per unit
C) multiplying the contribution margin by sales revenue
D) dividing the fixed costs by contribution margin

Question

Quizplus · Accepted Answer

The degree of operating leverage is calculated by dividing the contribution margin by operating income. This measure helps in understanding how a company's operating income changes with a change in its sales volume.

The Degree of Operating Leverage Can Be Measured by ________