Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Operating Leverage Beck Inc. and Bryant Inc. have the following operating data: Back Inc. Bryant Inc. Sales $355,700 $1,059,500 Variable costs (147,100) (535,700) Contribution margin
Operating Leverage Beck Inc. and Bryant Inc. have the following operating data: Back Inc. Bryant Inc. Sales $355,700 $1,059,500 Variable costs (147,100) (535,700) Contribution margin $219,600 $423,800 xed costs (155,600) (250,300) Operating income $51300 $153300 1]. Compute the operating leverage for Beck Inc. and Bryant Inc. If required, round be one decimal place. Beak Inc. :1 Brya nt Inc. C] II. How much would operating income increase for each company if the sales of each increased by 15%? If required, round answers In nearest whole number. Dull-rs Percentage mm E :1 % c. The difference in the increases ' If of operating income is due to the difference in the operating leverages. Beck Inc.'5 higher ' if operating leverage means that its xed costs are a larger ' if peroenmge of contribuljon margin than are Bryant Incs. Break-Even Sales and Sales Mix for a Service Company Zero Turbulence Airline provides air transportation services between Los Angeles, California, and Kona, Hawaii. A single Los Angeles to Kona round-trip flight has the following operating statistics: Fuel $5,396 Flight crew salaries 4,133 Airplane depreciation 1,951 Variable cost per passenger-business class 50 Variable cost per passenger-economy class 40 Round-trip ticket price-business class 580 Round-trip ticket price-economy class 300 It is assumed that the fuel, crew salaries, and airplane depreciation are fixed, regardless of the number of seats sold for the round-trip flight. a. Compute the break-even number of seats sold on a single round-trip flight for the overall enterprise product, E. Assume that the overall product mix is 10% business class and 90% economy class tickets. Total number of seats at break-even seats b. How many business class and economy class seats would be sold at the break-even point? Business class seats at break-even seats Economy class seats at break-even seats
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started