What does the starting level of sales determine the degree of operating leverage rather than the ending level of sales?

The starting level of sales is crucial in determining the degree of operating leverage because it reflects the fixed and variable cost structure at that specific point in time. Operating leverage measures how changes in sales volume affect operating income, and it is most relevant when sales are analyzed from their initial level. If sales increase from a low starting point, the impact of fixed costs on profitability is magnified, leading to higher operating leverage. Conversely, the ending level of sales may not accurately represent the cost behavior or the relationship between sales and profits established at the beginning.