Assuming that sales revenue decreases by $20\%,$ prepare a variable cost income statement for each company.

The following CVP income statements are available for Carla Vista Company and Sandhill Company: Carla Vista Sandhill Company Company Sales revenue $375,000 $375,000 Variable costs 187,500 75,000 Contribution margin 187,500 300,000 Fixed costs 137,500 250,000 Operating income $50,000 $50,000