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Why is there a difference in the increase in income from

Rose Inc. and Tulip Inc. have the following operating data:

326_275-B-M-A-C-V-P (1396).png

a. Compute the operating leverage for Rose Inc. and Tulip Inc.

b. How much would income from operations increase for each company if the sales of each increased by 25%?

c. Why is there a difference in the increase in income from operations for the two companies?Explain.

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