# How do You Calculate Operating Leverage?

When you are calculating operating leverage the first thing that you want to do is measure revenue growth with its use of operating income.
How to Calculate Operating Leverage
In finance, "leverage" is a common term that describes the extent to which a firm utilizes some resource to increase potential return on investment. Operating leverage analyzes how fixed operating costs, such as equipment, buildings and other fixed-asset... More »
Difficulty: Moderately Easy
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Q&A Related to "How do You Calculate Operating Leverage?"
 1. Examine the formula to calculate operating leverage: Operating Leverage = (Price of Product - Variable Cost per unit] x units sold) / (Price of Product - Variable Cost per unit http://www.ehow.com/how_7595071_calculate-operatin...
 The degree to which the operating income of a company responds to any percentage of change in sales is known as the operating leverage of a company. You can find more information http://answers.ask.com/Consumer_Electronics/Other/...
 DOL is a ratio that is used to identify the changes in the operating leverage that a company requires with growth in sales and income. As and when a company grows and its sales increases http://wiki.answers.com/Q/How_do_you_calculate_the...
 A measurement of the degree to which a firm or http://www.chacha.com/question/how-do-you-calculat...
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To calculate the operating leverage you need to know the price of the product or products, the cost per unit, and the fixed cost per unit. You can find more ...
1. Review the formula. The formula for DOL is "contribution margin" divided by "net operating income.". 2. Determine contribution margin. The ...