Palmer Company Below Is an Income Statement for Palmer Company

question 46

Multiple Choice

Palmer Company Below is an income statement for Palmer Company:
$\begin{array}{ll}\text { Sales } & \$ 400,000 \\\text { Variable costs } & \underline{(125,000) } \\\text { Contribution margin } & \$ 275,000 \\\text { Fixed costs } & \underline{(200,000) } \\\text { Profit before taxes } & \underline{\$ 75,000}\end{array}$ Refer to Palmer Company.What is Palmer's degree of operating leverage?

• A)3.67
• B)5.33
• C)1.45
• D)2.67

---

Definitions:

Job Science

An interdisciplinary field that applies scientific methods and principles to the study of employment, workforce dynamics, and labor markets.

Bureaucratic Organisations

Organizations characterized by a hierarchically structured authority, formal rules and procedures, and a clear division of labor.

Social Status

The position or rank of a person or group within the hierarchy of a society, determined by various factors including wealth, occupation, education, and family background.

Division of Labour

The assignment of different parts of a manufacturing process or task to different people in order to improve efficiency.