The Degree of Operating Leverage for Madrigal Company Is 2

question 118

True/False

The degree of operating leverage for Madrigal Company is 2.The actual operating income is $14,000.If the company expects a 25% increase in sales,operating income should increase by $3,500.

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Definitions:

Shells

Hard, protective outer layers created by animals that live in the sea.

Marine Creatures

Organisms that inhabit or depend on the ocean environment for their survival and reproduction.

Sandstones

Sedimentary rocks composed mainly of sand-sized mineral particles or rock fragments, often used in construction due to their durability and aesthetic appearance.

Fine-grained

Material having small, closely packed particles or crystals, often refers to sediments or rocks with such texture.