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Check my The following sales and cost data (in thousands) are for two companies in the transportation industry: Company A Company B Percent Percent of
Check my The following sales and cost data (in thousands) are for two companies in the transportation industry: Company A Company B Percent Percent of of Amount Sales Amount Sales Sales $ 140,000 100% $ 140,000 1009 Variable costs 70,000 50 42,000 30 Contribution margin $ 70,000 50% $ 98,000 70% Fixed costs 22,400 43,400 Operating profit $ 47,600 $ 54,600 Required: 1-a. Calculate the degree of operating leverage (DOL) for each company. 1-b. If sales increase from the present level, which company benefits more? 2. Assume that sales rise 20% in the next year but that everything else remains constant. Calculate the percentage increase in profit for each company Complete this question by entering your answers in the tabs below. Reg 1A Reg 1B Req 2
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