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2 (12 points) Income statements for two different companies in the same industry are as follows: Sales Less: Variable costs Contribution margin Less: Fixed costs
2 (12 points) Income statements for two different companies in the same industry are as follows: Sales Less: Variable costs Contribution margin Less: Fixed costs Operating income Required: A. B. C. Company A $400,000 Company B $400,000 300,000 200.000 $100,000 $200,000 50.000 150.000 $ 50,000 $ 50.000 Calculate the degree of operating leverage for each firm. Calculate the margin of safety in dollars for each firm. Determine the operating income for each firm if sales increase by 20%
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