Fancy Furniture has variable expenses of 40% of sales and monthly fixed expenses of $240,000

Accounting Mar 05, 2021

Fancy Furniture has variable expenses of 40% of sales and monthly fixed expenses of $240,000. The monthly target operating income is $60,000. What is Fancy Furniture's operating leverage factor at the target level of operating income?

A) 0.20

B) 5.00

C) 6.75

D) 1.25

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