Question
Operating Leverage Beck Inc. and Bryant Inc. have the following operating data: Beck Inc. Bryant Inc. Sales$312,600$768,000Variable costs125,400460,800Contribution margin$187,200$307,200Fixed costs115,200115,200Income from operations$72,000$192,000 a. Compute the
Operating Leverage Beck Inc. and Bryant Inc. have the following operating data: Beck Inc.Bryant Inc.Sales$312,600$768,000Variable costs125,400460,800Contribution margin$187,200$307,200Fixed costs115,200115,200Income from operations$72,000$192,000 a. Compute the operating leverage for Beck Inc. and Bryant Inc. If required, round to one decimal place. Beck Inc.Bryant Inc. b. How much would income from operations increase for each company if the sales of each increased by 15%? If required, round answers to nearest whole number. DollarsPercentageBeck Inc.$%Bryant Inc.$% c. The difference in theof income from operations is due to the difference in the operating leverages. Beck Inc.'soperating leverage means that its fixed costs are apercentage of contribution margin than are Bryant Inc.'s.
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