Fielder Productions reports the following information:
Total contribution margin………………… $32,000
Total fixed costs…………………………… $28,000
Required:
(a) Calculate Fielder's degree of operating leverage (DOL).
(b) If sales increase by 6%, what is the expected percentage increase in pretax income?

Question

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The Answer of Fielder Productions reports the following information:
Total contribution margin………………… $32,000
Total fixed costs…………………………… $28,000
Required:
(a) Calculate Fielder's degree of operating leverage (DOL).
(b) If sales increase by 6%, what is the expected percentage increase in pretax income?

Fielder Productions Reports the Following Information