Saved 1: Chp 03 - Homework Assignments Check my Spring Company's cost structure is dominated by variable costs with a contribution margin ratio of 0 20 and fixed costs of $60,000 Every dollar of sales contributes 20 cents toward fixed costs and profit. The cost structure of a competitor, Winters Company, is dominated by fixed costs with a higher contribution margin ratio of 0.70 and fixed costs of $310,000. Every dollar of sales contributes 70 cents toward fixed costs and profit. Both companies have sales of $500,000 per month Required: a. Compare the two companies' cost structures. b. Suppose that both companies experience an 8 percent increase in sales volume. By how much would each company's profits increase? Complete this question by entering your answers in the tabs below. s Required A Required B Compare the two companies' cost structures. WINTERS COMPANY Amount Percentage SPRING COMPANY Amount Percentage % Sales Variable cost 04 Required A Required B Compare the two companies' cost structures. SPRING COMPANY Amount Percentage % WINTERS COMPANY Amount Percentage % Sales Variable cost % % Contribution margin Fixed costs % % Operating profit Required B > increase? Complete this question by entering your answers in the tabs below. Required A Required B Suppose that both companies experience an 8 percent increase in sales volume. By how much would each company's profits increase? Spring Company's profits increase by Winter Company's profits increase by Hotels