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Assume that Company A and Company B sell a microwave popcorn popper for $ 2 2 . Although the companies have different cost structures, both
Assume that Company A and Company B sell a microwave popcorn popper for $ Although the companies have different cost structures, both companies are profitable based on sales of units as shown in the following financial statements for the month of June. Both companies hold no inventory and sell contractual orders in the month.
For the Month of June Company A Company B
Sales $ $
Variable cost of goods sold $ Company A and B respectively $ $
Variable selling and administrative costs $ $ Company A and B respectively $ $
Contribution margin $ $
Fixed cost of goods sold $ $
Fixed selling and administrative costs $ $
Profits BeforeTax $ $
Due to an expected downturn in market conditions, both companies are forecasting the effects of different scenarios on monthly profit.
Assume that sales volume decreases to units for the month for both companies. What would be the impact on profit for Company BEnter an increase in profits as positive; enter a decrease in profits as negative.
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