Juan, the owner of quality catering, is driven by competition. he is very focused on meeting deadlines and quality, and on delivering the results that customers want. he pushes his managers to continually exceed their productivity goals, and he stresses that profits take precedence over employee development and satisfaction. juan feels "there is not enough time for training." however, his employees are regularly rewarded for their success in meeting company goals. quality catering has a(n) culture.

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.