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  3. 1. the following cvp income statements are availab

1. The following CVP income statements are available for ABC Company and XYZ Company ABC...

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1. The following CVP income statements are available for ABC Company and XYZ Company ABC Company XYZ Company CVP I/S for 2020 CVP I/S for 2020 Sales $500,000 $500,000 Variable costs 300,000 180,000 Contribution margin 200,000 320,000 I Fixed costs 180,000 300,000 Operating income $ 20,000 $ 20,000 (a) Compute the break-even point in dollars and the margin of safety ratio for each company (b) Compute the degree of operating leverage for each company. (C) Assuming that sales revenue decreases by 20%, prepare a CVP income statement for each company, (d) Assuming that sales revenue increases by 20%. calculate the operating incomes of the two companies without preparing income statement. (Use DOL)

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