Solved

Alford,Brooks,and Fitch Companies Below Are Income Statements That Apply to Three

Question 91

Multiple Choice

Alford,Brooks,and Fitch Companies Below are income statements that apply to three companies: Alford,Brooks,and Fitch:
 AlfordCo.BrooksCo.FitchCo  Sales $100$100$100 Variable costs (10) (20) (30)  Contribution margin $90$80$70 Fixed costs (30) (20) (10) Profit before taxes:$60$60$60\begin{array}{lccc}&\text { AlfordCo.}&\text {BrooksCo.}&\text {FitchCo }\\\hline\text { Sales } & \$ 100 & \$ 100 & \$ 100 \\\text { Variable costs } & (\underline{10}) & (\underline{20}) & (\underline{30}) \\\text { Contribution margin } & \$ 90 & \$ 80 & \$ 70 \\\text { Fixed costs } & (\underline{30}) & (\underline{20}) & (\underline{10}) \\\text{Profit before taxes:}&\$ 60 &\$ 60 &\$ 60 \end{array} Refer to Alford,Brooks,and Fitch Companies.Within the relevant range,if sales go up by one unit for each firm,which firm will experience the greatest increase in net income?


A) Alpha Company
B) Beta Company
C) Fitch Company
D) can't be determined from the information given

Correct Answer:

verifed

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions

Unlock this Answer For Free Now!

View this answer and more for free by performing one of the following actions

qr-code

Scan the QR code to install the App and get 2 free unlocks

upload documents

Unlock quizzes for free by uploading documents