A) net operating income divided by total expenses. D AACSB: Analytic AICPA BB: Critical Thinking AICPA FN: Reporting LO: 8 Level: Easy Source: CMA;…

A) net operating income divided by total expenses. Ans: D AACSB: Analytic AICPA BB: Critical Thinking AICPA FN: Reporting LO: 8 Level: Easy Source: CMA; adapted 28. Which of the following is the correct calculation for the degree of operating leverage? A) net operating income divided by total expenses. B) net operating income divided by total contribution margin. C) total contribution margin divided by net operating income. D) variable expense divided by total contribution margin. Ans: C AACSB: Reflective Thinking AICPA BB: Critical Thinking AICPA FN: Reporting LO: 8 Level: Easy 29. Which of the following is an assumption underlying standard CVP analysis? A) In multiproduct companies, the sales mix is constant. B) In manufacturing companies, inventories always change. C) The price of a product or service is expected to change as volume changes. D) Fixed expenses will change as volume increases.