Calculate the break-even point for each firm

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Assume that two companies, Brake, Inc. and Carbo, Inc., have the following operating results:

	Brake, Inc.	Carbo, Inc.
Sales	$300,000	$300,000
Variable Costs	60,000	180,000
Fixed Costs	210,000	90,000
Operating Income	$30,000	$30,000

Required:

Calculate the contribution margins for the two companies.
Calculate the break-even point for each firm, in dollars and in units.
Compare the two companies. What conclusions could you make regarding the use of operating leverage employed by the two firms?
Assume that both companies experience an increase in sales by 15% next year. What would be the

Reference no: EM131299644

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