Presented below are variable costing income statements for Logan Company and Morgan Company. They are in the same industry, with the same net incomes, but different cost structures.
|
Logan Co.
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Morgan Co.
|
|
Sales
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$200,000
|
$200,000
|
|
Variable costs
|
80,000
|
50,000
|
|
Contribution margin
|
120,000
|
150,000
|
|
Fixed costs
|
60,000
|
90,000
|
|
Net income
|
$ 60,000
|
$ 60,000
|
Compute the break-even point in dollars for each company and comment on your findings.