The CVP income statements shown below are available for Armstrong Company and Contador Company. Armstrong Co. Contador C
Posted: Sun Jul 03, 2022 1:22 pm
The CVP income statements shown below are available forArmstrong Company and Contador Company.
Armstrong Co.
Contador Co.
(a1) Compute the degree of operating leveragefor each company. (Round answers to 2 decimalplaces, e.g. 1.15.)
Degree of Operating Leverage
(b) Assuming that sales revenue increases by10%, prepare a variable costing income statement for eachcompany.
Armstrong Company
Contador Company
Total Variable ExpensesVariable CostsCost of Goods SoldTotalFixed ExpensesAdministrative ExpensesFixed CostsContributionMarginSelling ExpensesGross ProfitSales RevenueNetIncome/(Loss)
$
$
Gross ProfitCost of Goods SoldNet Income/(Loss)ContributionMarginSelling ExpensesSales RevenueFixed CostsTotal FixedExpensesAdministrative ExpensesTotal Variable ExpensesVariableCosts
Fixed CostsCost of Goods SoldSales RevenueContributionMarginGross ProfitVariable CostsAdministrative ExpensesTotalVariable ExpensesSelling ExpensesTotal Fixed ExpensesNetIncome/(Loss)
Contribution MarginTotal Fixed ExpensesVariable CostsSalesRevenueTotal Variable ExpensesAdministrative ExpensesCost of GoodsSoldNet Income/(Loss)Gross ProfitFixed CostsSelling Expenses
Net Income/(Loss)Total Fixed ExpensesContributionMarginVariable CostsSales RevenueSelling ExpensesAdministrativeExpensesTotal Variable ExpensesCost of Goods SoldGross ProfitFixedCosts
$
$
Armstrong Co.
Contador Co.
(a1) Compute the degree of operating leveragefor each company. (Round answers to 2 decimalplaces, e.g. 1.15.)
Degree of Operating Leverage
(b) Assuming that sales revenue increases by10%, prepare a variable costing income statement for eachcompany.
Armstrong Company
Contador Company
Total Variable ExpensesVariable CostsCost of Goods SoldTotalFixed ExpensesAdministrative ExpensesFixed CostsContributionMarginSelling ExpensesGross ProfitSales RevenueNetIncome/(Loss)
$
$
Gross ProfitCost of Goods SoldNet Income/(Loss)ContributionMarginSelling ExpensesSales RevenueFixed CostsTotal FixedExpensesAdministrative ExpensesTotal Variable ExpensesVariableCosts
Fixed CostsCost of Goods SoldSales RevenueContributionMarginGross ProfitVariable CostsAdministrative ExpensesTotalVariable ExpensesSelling ExpensesTotal Fixed ExpensesNetIncome/(Loss)
Contribution MarginTotal Fixed ExpensesVariable CostsSalesRevenueTotal Variable ExpensesAdministrative ExpensesCost of GoodsSoldNet Income/(Loss)Gross ProfitFixed CostsSelling Expenses
Net Income/(Loss)Total Fixed ExpensesContributionMarginVariable CostsSales RevenueSelling ExpensesAdministrativeExpensesTotal Variable ExpensesCost of Goods SoldGross ProfitFixedCosts
$
$