The Richard Company Has an Operating Leverage of 2

question 60

Multiple Choice

The Richard Company has an operating leverage of 2.Sales for the current year are $100,000 with a contribution margin of $50,000.Sales are expected to be $150,000 for the following year.Operating income for the following year can be expected to increase by what amount over the current year?

• A)40%
• B)200%
• C)$25,000
• D)$50,000