Question: From the following selected operating data, determine the operating leverage. Which company has the greater amount of business risk? Company A Company B (Rials) (Rials)
From the following selected operating data, determine the operating leverage. Which company has the greater amount of business risk? Company A Company B (Rials) (Rials) Sales 10,00,000 20,00,000 Fixed cost 10 % of sales 5% of sales Variable expenses as a percentage of sales are 40 percent for Company A and 25 percent for Company B. Select one: a. Company A= 1.2, Company B =1.07 Company A has greater business risk O b. Company A= 1.02, Company B =1.07 Company B has greater business risk O c. Company A= 1.2, Company B =1.07 Company B has greater business risk O d. Company A= 1.02, Company B =1.07 Company A has greater business risk
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