Busıness Fınance I Deneme Sınavı Sorusu #852663
Which of the following shows the degree of operating leverage?
The percentage change in the net income as the result of the percentage change in the sales volume |
The percentage change in the operating income as the result of the percentage change in the sales volume |
The percentage change in the net income as the result of the percentage change in the variable costs |
The percentage change in the sales volume as the result of the percentage change in cost of the goods sold |
The percentage change in the sales volume as the result of the percentage change in the sales price |
The degree of operating leverage is a concept widely used to assess the operating risk of a business stemming from its cost structure. Basically, the degree of operating leverage shows how much the operating income of the business changes with a relative change in its sales. In fact it is a multiple depicting how many times the operating income of a business changes in relation to a percentage change in the sales.
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