Question
The following CVP income statements are available for Blossom Company and Crane Company: Blossom Company Crane Company Assuming that sales revenue increases by 20%, prepare
The following CVP income statements are available for Blossom Company and Crane Company: Blossom Company Crane Company Assuming that sales revenue increases by 20%, prepare a variable cost income statement for cach company . Sales revenue $390,000 $390,000 Blossom Company Crane Company Variable costs 234,000 78,000 $ Contribution margin 156,000 312,000 Sales Variable costs Contribution margin Fixed costs Operating income Fixed costs 106,000 262,000 Operating income $50,000 $50,000 Calculate the break-even point in dollars and the margin of safety ratio for each company. (Round break-even point to the nearest whole dollar, eg,5,275 and margin of safety ratio to 2 decimal places, es 15.25%.) c Textbook and Media Blossom Company Crane Company Break-even point $ $ Assuming that sales revenue decreases by 20%, prepare a variable cost income statement for each company. Enter loss using either a negative slon preceding the numbereg.-45 ar parentheses ... (450) Margin of safety ratio % % Blossom Company Crane Company e Textbook and Media V Calculate the degree of operating leverage for each company. (Round answers to 2 decimal places, e.g. 15.25.) Blossom Company e Textbook and Media Crane Company
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