Question
Operating Leverage Beck Inc. and Bryant Inc. have the following operating data: Bryant Inc. Beck Inc. Sales $195,400 $520,000 Variable costs 78,400 312,000 Contribution
Operating Leverage Beck Inc. and Bryant Inc. have the following operating data: Bryant Inc. Beck Inc. Sales $195,400 $520,000 Variable costs 78,400 312,000 Contribution margin $117,000 $208,000 Fixed costs Income from operations 78,000 $39,000 104,000 $104,000 a. Compute the operating leverage for Beck Inc. and Bryant Inc. If required, round to one decimal place. Beck Inc. Bryant Inc. b. How much would income from operations increase for each company if the sales of each increased by 20%? If required, round answers to nearest whole number. Beck Inc. Dollars Percentage % Bryant Inc. % c. The difference in the of income from operations is due to the difference in the operating leverages. Beck Inc.'s percentage of contribution margin than are Bryant Inc.'s. operating leverage means that its fixed costs are a
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