Based on the income statements of the three following retail businesses, which company has the highest operating leverage? AlphaCompanyBetaCompanyGammaCompanyRevenue $200,000 $200,000 $200,000 Variable costs (95,000) (155,000) (125,000) Contribution margin 105,000 45,000 75,000 Fixed costs (80,000) (20,000) (50,000) Net income $25,000 $25,000 $25,000
A. Gamma Company
B. They all have same operating leverage
C. Alpha Company
D. Beta Company
Answer: C
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