Beck Inc. and Bryant Inc. have the following operating data:

Beck Inc. Bryant Inc.

Sales $$1,250,000$ $$2,000,000$

Variable costs $(750,000)(1,250,000)$

Contribution margin $$500,000$ $$750,000$

Fixed costs $(400,000)(450,000)$

Operating income $$100,000$ $$300,000$

a$.$ Compute the operating leverage for Beck Inc. and Bryant Inc. If required, round to one decimal place.

Beck Inc. fill in the blank $1$

Bryant Inc. fill in the blank $2$

b$.$ How much would operating income increase for each company if the sales of each increased by $20\%?$

Dollars Percentage

Beck Inc. $fill in the blank $3$

fill in the blank $4$

$\%$

Bryant Inc. $fill in the blank $5$

fill in the blank $6$

$\%$

c$.$ The difference in the

of operating income is due to the difference in the operating leverages. Beck Inc.$\text{'}$s

operating leverage means that its fixed costs are a

percentage of contribution margin than are Bryant Inc.$\text{'}$s$.$

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