Assume that the variable costs consist of food and packaging; payroll; and 40% of the general, selling, and administrative expenses. 1. What is McDonald's contribution margin? Round to the nearest tenth of a million (one decimal place). 2. What is McDonald's contribution margin ratio? Round to one decimal place. Answer Check Figure: 34.6% 3. How much would income from operations increase if same- store sales increased by $500 million for the coming year, with no change in the contribution margin ratio or fixed costs? Round your answer to the nearest tenth of a million (one decimal place).

Assume that the variable costs consist of food and packaging; payroll; and 40% of the general, selling, and administrative expenses. 1. What is McDonald's contribution margin? Round to the nearest tenth of a million (one decimal place). 2. What is McDonald's contribution margin ratio? Round to one decimal place. Answer Check Figure: 34.6% 3. How much would income from operations increase if same- store sales increased by $500 million for the coming year, with no change in the contribution margin ratio or fixed costs? Round your answer to the nearest tenth of a million (one decimal place).

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Last month when Holiday Creations, Incorporated, sold 35,000 units, total sales were $140,000, total variable expenses were $109,200, and fixed expenses were $38,600. Required: 1. What is the company's contribution margin (CM) ratio? 2. What is the estimated change in the company's net operating income if it can increase sales volume by 300 units and total sales by $1,200? Note: Do not round intermediate calculations. Answer is complete but not entirely correct. 1. Contribution margin ratio 2. Estimated change in net operating income 22 % $ 347 X
please step by step solution.
Variable costs as a percentage of sales for Lemon Inc. are 64%, current sales are $691,000, and fixed costs are $180,000. How much will operating income change if sales increase by $41,800?
Diamond, Inc.'s most recent contribution margin income statement shows the following: Sales @ $10 per unit Less: Variable expenses Contribution margin Less: Fixed expenses Operating income (loss) $160,000 (120,000) $ 40,000 (50,000) $ (10,000) If Diamond, Inc's advertising costs increased by $5,000, by how much would sales have to increase for the company to achieve an operating income of $4,000? a. $56,000 Ob. $42,000 c. $76,000 Od. $18,000
Dhapa
Last month when Holiday Creations, Incorporated, sold 38,000 units, total sales were $152,000, total variable expenses were $127,680, and fixed expenses were $37,200. Required: 1. What is the company's contribution margin (CM) ratio? 2. What is the estimated change in the company's net operating income if it can increase sales volume by 500 units and total sales by $2,000? (Do not round intermediate calculations.) 1. Contribution margin ratio 2. Estimated change in net operating income %
Diamond, Inc.'s most recent contribution margin income statement shows the following: Sales @ $10 per unit Less: Variable expenses Contribution margin Less: Fixed expenses Operating income (loss) $160,000 (120,000) $ 40,000 (50,000) $ (10,000) If Diamond, Inc's advertising costs increased by $5,000, by how much would sales have to increase for the company to achieve an operating income of $4,000? a. $56,000 b. $42,000 c. $76,000 Od. $18,000
Last month when Holiday Creations, Incorporated, sold 41,000 units, total sales were $164,000, total variable expenses were $116,440, and fixed expenses were $38,600. Required: 1. What is the company's contribution margin (CM) ratio? 2. What is the estimated change in the company's net operating income if it can increase sales volume by 600 units and total sales by $2,400? (Do not round intermediate calculations.)
I need help with parts 1 and 2
The Biscuits Crunch Company had the following information available regarding last year's operations: Sales (100,000 units) Variable costs Contribution margin Fixed costs Net Income $200,000 100,000 100,000 50,000 50,000 If sales were to increase by 200 units, what would be the effect on net income? A) 400 increase B) 200 increase C) 100 increase D) 200 loss E) 150 increase
A company has a contribution margin ratio of 40%. By what percentage should sales be increased to offset 20% reduction in selling price?
Gadubhai