Donald, the ceo of a multinational organization, is given a reward by the organization in the form of a contract that allows him to purchase 5 percent shares of the company anytime in the future at a predetermined price. three years later, donald purchases those shares at half their market price. additionally, he gets more motivated to work toward increasing the performance of the organization. in this scenario, donald was given a

Engberg company installs lawn sod in home yards. the company’s most recent monthly contribution format income statement follows: amount percent of sales sales $ 80,000 100% variable expenses 32,000 40% contribution margin 48,000 60% fixed expenses 38,000 net operating income $ 10,000 required: 1. compute the company’s degree of operating leverage. (round your answer to 1 decimal place.) 2. using the degree of operating leverage, estimate the impact on net operating income of a 5% increase in sales. (do not round intermediate calculations.) 3. construct a new contribution format income statement for the company assuming a 5% increase in sales.