Question: 238 points Spring Company's cost structure is dominated by variable costs with a contribution margin ra of 025 and fixed costs of S100,000. Every dollar

 238 points Spring Company's cost structure is dominated by variable costs
with a contribution margin ra of 025 and fixed costs of S100,000.

238 points Spring Company's cost structure is dominated by variable costs with a contribution margin ra of 025 and fixed costs of S100,000. Every dollar of sales contributes 25 cents toward fixed costs and profit. The cost structure of a competi Winters Company, is dominated by foxed costs with a higher contribution ratio of0.80 and fixed costs of $430,000. Every dollar of margin sales contributes 80 cents toward fixed costs and profit Both companies have sales of$600.000 per month. Required a. Compare the two companies cost structures, WINTERS COMPANY SPRING COMPANY Amount Percentage Amount Percentage 75 Contribution margin 150000

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Accounting Questions!