Shown here are condensed income statements for two differentcompanies (both are organized as LLCs and pay no income taxes).
Miller Company
Sales $1,000,000
Variable expenses(80%) 800,000
Income beforeinterest 200,000
Interest expense(fixed) 60,000
Net income $140,000
WeaverCompany
Sales $1,000,000
Variable expenses(60%) 600,000
Income beforeinterest 400,000
Interest expense(fixed) 260,000
Net income $140,000
What happens to each company’s net income if sales increase by30%? (Round your answers to nearest wholepercent.)
What happens to each company’s net income if sales increase by50%? (Round your answers to nearest wholepercent.)
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