The Following Income Statements Are Provided for Two Companies Operating

question 4

Multiple Choice

The following income statements are provided for two companies operating in the same industry: $\begin{array}{c}\begin{array}{|l|}\hline\\\hline \text {Reverue}\\\hline \text {Variable costs}\\\hline \text {Contribution margin}\\\hline \text {Fixed costs}\\\hline \text {Net income}\\\hline\end{array}\begin{array}{l|}\hline\text { Felix Company }\\\hline\$ 200,000 \\\hline (25,000) \\\hline 175,000 \\\hline (70,000) \\\hline \$ 105,000\\\hline \end{array}\begin{array}{l|}\hline\text { Jinx Compeny }\\\hline\$ 200,000 \\\hline (70,000) \\\hline 130,000 \\\hline(25,000) \\\hline \$ \quad 105,000\\\hline \end{array}\end{array}$
Assuming sales increase by $1,000,select the correct statement from the following:

• A) Felix's net income will be more than Jinx's.
• B) Only Felix will experience an increase in profit.
• C) Felix's net income will increase by $250.
• D) Jinx's net income will increase by 6%.

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Definitions:

Water Seal

Water seal refers to a system used in chest drainage devices that prevents air from re-entering the pleural space while allowing air and fluids to exit, facilitating lung expansion.

Ventilator

A medical device used to assist or take over breathing for a patient who is unable to breathe adequately on their own.

Water-Seal Chamber

A component of chest drainage systems designed to prevent air from re-entering the pleural space while allowing gas and fluid to escape from the chest.

Suction-Control Chamber

Part of a chest drainage system that regulates the negative pressure applied, helping to remove air, fluid, or pus from the thoracic cavity.