Exercise 3-34 Analysis of Cost Structure (LO 3-2) Spring Company's cost structure is domnated by variable costs wh a contribution margin ratio of 0.45 and fixed costs of S78,000. Every dolar of sales contributes 45 cents toward fixed costs and prot. The cost structuire of a competitor, Winters Company, is dominated by nixed costs with a higher contribution margin rado of 0.80 and fxed costs of $305,500. Every dollar of sales contributes 80 cents toward fixed costs and profit. Both companles have saies of $650,000 per month a. Compare the two companies' cost structures. SPRING co Variable cost Contibuton margin Flod costs Operating proit b. Suppose that both companies experienoe a 10 percent increase in sales volume, By how much would each company's profits increase? Company's pronis increase