The following sales and cost data (in thousands) are for two companies in the transportation Industry: Sales Variable costs Contribution margin Fixed costs Operating profit Company A Percent of Amount Sales $100,000 1000 50,000 50 $ 50,000 504 15,000 $ 35,000 Company B Percent of Amount Sales $100,000 1000 30,000 $70,000 40,000 $ 30,000 Required: 1-a. Calculate the degree of operating leverage (DOL) for each company. 1-b. If sales increase from the present level, which company benefits more? 2. Assume that sales rise 10% in the next year but that everything else remains constant. Calculate the percentage increase in profit for each company. Complete this question by entering your answers in the tabs below. Req 1A Req 18 Reg 2 Calculate the degree of operating leverage (DOL) for each company. (Round your answers to 3 decimal places.) - Check my work Fixed costs Operating profit 15,000 $ 35,000 40,000 $ 30,000 Required: 1-a. Calculate the degree of operating leverage (DOL) for each company. 1-b. If sales increase from the present level, which company benefits more? 2. Assume that sales rise 10% in the next year but that everything else remains constant. Calculate the percentage Increase in profit for each company. Complete this question by entering your answers in the tabs below. Req 1A Reg 1B Reg 2 Calculate the degree of operating leverage (DOL) for each company. (Round your answers to 3 decimal places.) Company A Company B Degree of operating leverage Reg 18 > Check my w Pixed coats Operating profit 15,000 35,000 40,000 30,000 Required: 1-a. Calculate the degree of operating leverage (DOL) for each company 1-b. If sales increase from the present level, which company benefits more? 2. Assume that sales rise 10% in the next year but that everything else remains constant. Calculate the percentage increase in profit each company. Complete this question by entering your answers in the tabs below. Reg 1A Req 1B Req 2 Ir sales increase from the present level, which company benefits more? O Company A Company B Fixed costs Operating profit 15,000 $ 35,000 40,000 $ 30,000 Required: 1-a. Calculate the degree of operating leverage (DOL) for each company. 1-b. If sales increase from the present level, which company benefits more? 2. Assume that sales rise 10% in the next year but that everything else remains constant. Calculate the percentage increase in profil each company. Complete this question by entering your answers in the tabs below. Reg 16 Reg 1A Reg 1B Reg 2 OLLAAN .. . .................. .. . Assume that sales rise 10% in the next year but that everything else remains constant. Calculate the percentage increase in profit for each company. Sinput your answers.as.percentages. rounded to 2.decimal places...e..0.1567-15.67%).... Company A Company B Increase in profit
