he following information was drawn from the annual reports of two companies.

Company A Company B

Sales Revenue $ $1,000$ $ $2,000$

Cost of Goods Sold $(400)(600)$

Gross Margin $6001,400$

Operating Expenses $(220)(800)$

Operating Income $380600$

Gain on the Sale of Equipment $3500$

Net Income $ $630$ $ $600$

Assume both companies receive a $$3,000$ increase in sales and the return$-$on$-$sales ratio does not change. Under these circumstances

Multiple Choice

Company A$\text{'}$s operating income would increase by $$1,140.$

Company B$\text{'}$s operating income would increase by $$600.$

Both answers are correct.

Neither answer is correct.

PrevQuestion $3$ of $5$ Total$3$ of $5$Visit question mapNext