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Sales Variable costs Contribution margin Fixed costs Blossom Company $510,000 306,000 204,000 173,400 Crane Company $510,000 183,600 326,400 275,400

Sales Variable costs Contribution margin Fixed costs Blossom Company $510,000 306,000 204,000 173,400 Crane Company $510,000 183,600 326,400 275,400

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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The following single-column CVP income statements are available for Blossom Company and Crane Company. Sales Variable costs Contribution margin Fixed costs Net income Blossom Company Blossom Company Crane Company $510,000 $510,000 Crane Company 306,000 204,000 173,400 $30,600 183,600 Degree of Operating Leverage 326,400 Compute the degree of operating leverage for each company. (Round answers to 2 decimal places, e.g. 1.56.) 275,400 $51,000
Transcribed Image Text:The following single-column CVP income statements are available for Blossom Company and Crane Company. Sales Variable costs Contribution margin Fixed costs Net income Blossom Company Blossom Company Crane Company $510,000 $510,000 Crane Company 306,000 204,000 173,400 $30,600 183,600 Degree of Operating Leverage 326,400 Compute the degree of operating leverage for each company. (Round answers to 2 decimal places, e.g. 1.56.) 275,400 $51,000
Assuming that sales revenue increases by 20% due to an increase in sales quantity, prepare a CVP income statement for each company. (Enter negative amounts using either a negative sign preceding the number e.g.-45 or parentheses e.g. (45)) eTextbook and Media $ $ Blossom Company $ $ Blossom Company $ Assuming that sales revenue decreases by 20% due to a decrease in sales quantity, prepare a CVP income statement for each company. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45)) I Crane Company $ Crane Company
Transcribed Image Text:Assuming that sales revenue increases by 20% due to an increase in sales quantity, prepare a CVP income statement for each company. (Enter negative amounts using either a negative sign preceding the number e.g.-45 or parentheses e.g. (45)) eTextbook and Media $ $ Blossom Company $ $ Blossom Company $ Assuming that sales revenue decreases by 20% due to a decrease in sales quantity, prepare a CVP income statement for each company. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45)) I Crane Company $ Crane Company
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