Degree of Operating Leverage
Estimate local operating-profit sensitivity to sales volume.
Your numbers
Operating leverage
Business ratio based on your consistent-period inputs. Accounting definitions and industry comparisons may differ.
Scenario comparison
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Formula
Use DOL = Q(P−V)/[Q(P−V)−F]. Q is units sold, P is selling price per unit, V is variable cost per unit, and F is fixed operating costs. The denominator is modeled operating profit.
Estimate local operating-profit sensitivity to sales volume.
Worked example
- Units sold
- 1000
- Selling price per unit
- 20
- Variable cost per unit
- 10
- Fixed operating costs
- 5000
- Operating leverage
- 2
- Operating profit
- 5,000
Scope and limitations
Business ratio based on your consistent-period inputs. Accounting definitions and industry comparisons may differ.
Inputs are checked for missing values and allowed ranges. A result outside the finite numeric range is not displayed. Rounding affects display, while the calculation uses the model’s numeric precision.
Check your units and assumptions before relying on a result. Changing a label does not convert a currency or physical unit.
Formula version: 025741509075 · Example checked: