viery9934 viery9934

19-07-2017
Business

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Sales of $3800, has variable costs $300 and has fixed costs$1000. calculate the degree of operating leverage

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Aliwohaish12 Aliwohaish12

19-07-2017

The degree of operating leverage can be calculated by subtracting variable costs from sales and dividing it by sales minus variable costs and fixed costs.
The degree of operating leverage is
(3,800−300)÷(3,800−300−1,000)
=1.4

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