Explain your rationale in terms of margin contributions

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Question: Analyse components of Contributon Margin for MarCo Corporation and PoLo Corporation for the year ended 2027. MarCo Corporation Contribution Analysis of Income Forecast for 2027 PoLo Corporation Contribution Analysis of Income Forecast for 2027 Sales (5,000 x $1,000) $5,000,000 100% Sales (5,000 x $1,000) $5,000,000 100% Variable Costs (5,000 x $900) 4,500,000 90% Variable Costs (5,000 x $400) 2,000,000 40% Contribution (Margin) $ 500,000 10% Contribution (Margin) $3,000,000 60% Fixed Costs $ 500,000 Fixed Costs $3,000,000 Net Income $ -- 0 -- Net Income $ -- 0 -- The business idea that you had developed for BUS 1041 a few years ago was a start-up phenomenon. Amazon bought you out for $288 million and you're now an Angel Investor. You're analyzing income forecasts of two companies that make the same product and sell to the same market. Owners of both firms are seeking $250,000 to expand their businesses.

Based on the foregoing information, in which business would you invest?

Explain your rationale in terms of margin contributions.

Reference no: EM133322215

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