168k views
0 votes
Which of the following scenarios demonstrates the leverage effect on net operating income due to the existence of fixed costs?

A) A 25% increase in sales resulting in a 30% decrease in net operating income.
B) A 15% increase in sales resulting in a 15% increase in cost of goods sold.
C) A 25% increase in sales resulting in a 30% increase in net operating income.
D) A 25% increase in sales resulting in a 30% increase in fixed costs.

1 Answer

2 votes

Answer:

C) A 25% increase in sales resulting in a 30% increase in net operating income.

User Arthur Neves
by
8.4k points

No related questions found

Welcome to QAmmunity.org, where you can ask questions and receive answers from other members of our community.