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Question
Fielder Productions reports the following information:Total Contribution Margin"u00a6"u00a6"u00a6"u00a6"u00a6"u00a6"u00a6.. $32,000
Total Fixed Costs"u00a6"u00a6"u00a6"u00a6"u00a6"u00a6"u00a6"u00a6"u00a6"u00a6"u00a6. $28,000
Required:
(a) Calculate Fielder's degree of operating leverage (DOL).
(b) Fielder Productions forecasts a 6% increase in sales. What is the expected effect in percent on pretax income?
Answer
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