Jenae is able to purchase a different brand of coffee for half the price from a new supplier. She anticipated that her co-workers would object to switching to the new brand, as they were really partial to the coffee they have been drinking so far. Indeed, when offered a taste test of the old brand versus the new brand, her co-workers unanimously rejected the new brand. Jenae's boss, Steven, pointed out that this result was most likely due to the fact that the taste test was not .

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.