Contribution Margin and Contribution Margin RatioFor a recent year, McDooley's, a family-owned group of restaurants, had the following sales and expenses:Sales for all restaurantsFood and paperPayroll and employee benefitsOccupancy and other expensesSelling, general, and administrative expensesOther operating expensesNet operating expensesOperating income (loss)$100,56069,60039,90040,20017,460$291,000(267,720)$23,280Assume that the variable costs consist of food and paper, payroll and employee benefits, and 40% of the selling, general, and administrativeexpenses.a. What is McDooley's contribution margin?b. What is McDooley's contribution margin ratio? Round your percentage answer to one decimal place.%c. How much would operating income increase if the stores sales increased by $5,800 for the coming year, with no change in the contribution margin c. How much would operating income increase if the stores sales increased by $5,800 for the coming year, with no change in the contribution marginratio or fixed costs?d. What would have been the operating income or loss for the recent year if sales had been $5,800 more?

The break-even sales are the sales, where the business earns no profit no loss during the period.…

Contribution Margin and Contribution Margin Ratio For a recent year, McDooley's, a family-owned group of restaurants, had the following sales and expenses: Sales for all restaurants $291,000 Food and paper Payroll and employee benefits Occupancy and other expenses Selling, general, and administrative expenses Other operating expenses Net operating expenses Operating income (loss) $100,560 69,600 39,900 40,200 17,460 (267,720) $23,280 Assume that the variable costs consist of food and paper, payroll and employee benefits, and 40% of the selling, general, and administrative

Contribution Margin and Contribution Margin Ratio For a recent year, McDooley's, a family-owned group of restaurants, had the following sales and expenses: Sales for all restaurants $291,000 Food and paper Payroll and employee benefits Occupancy and other expenses Selling, general, and administrative expenses Other operating expenses Net operating expenses Operating income (loss) $100,560 69,600 39,900 40,200 17,460 (267,720) $23,280 Assume that the variable costs consist of food and paper, payroll and employee benefits, and 40% of the selling, general, and administrative

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

Please help me with all answers thanku
am. 172.
Below is financial information for the last year for a company that has a number of fast-food stores: Revenue from operations: $10,450,200 9,927,690 Operating costs: Cost of capital: RRR: 12% 15% Average assets: $4,180,080 Required: Calculate several measures that can be used for the financial perspective of a BSC.
Contribution Margin and Contribution Margin Ratio For a recent year, McDugal's company-owned restaurants had the following sales and expenses (in millions): Sales Food and packaging Payroll Occupancy (rent, depreciation, etc.) General, selling, and admin. expenses Other expense Total expenses Operating income (loss) $4,310 3,800 4,190 2,200 290 % $14,500 (14,790) $(290) Assume that the variable costs consist of food and packaging, payroll, and 40% of the general, a. What is McDonald's contribution margin? Enter your answer in million, rounded to one decimal place. million b. What is McDonald's contribution margin ratio? Round your percentage answer to one decimal place. and nistrative expenses. c. How much would operating income increase if same-store sales increased by $900 million for the coming year, with no change in the contribution margin ratio or fixed costs?
Assume a retailing company has two departments-Department A and Department B. The company's most recent contribution format income statement follows: Total Department A Department B $ 800,000 350,000 450,000 $ 350,000 250,000 Sales $ 450,000 Variable expenses Contribution margin 100,000 100,000 350,000 Fixed expenses 400,000 140,000 260,000 Net operating income (loss) $ 50,000 $ (40,000) $ 90,000 The company says that $60,000 of the fixed expenses being charged to Department A are sunk costs or allocated costs that will continue if the segment is discontinued. However, if Department A is discontinued the sales in Department B will drop by 18%. What is the financial advantage (disadvantage) of discontinuing Department A? Multiple Choice $(103,000) $(83,000) $(92,000) $(101,000)
Last year’s contribution format income statement for Huerra Company is given below: Total Unit Sales $ 1,002,000 $ 50.10 Variable expenses 601,200 30.06 Contribution margin 400,800 20.04 Fixed expenses 316,800 15.84 Net operating income 84,000 4.20 Income taxes @ 40% 33,600 1.68 Net income $ 50,400 $ 2.52 The company had average operating assets of $491,000 during the year. Required: Compute last year’s margin, turnover, and return on investment (ROI). For each of the following questions, indicate whether last year’s margin and turnover will increase, decrease, or remain unchanged as a result of the events described, and then compute the new ROI. Consider each question separately. Using Lean Production, the company is able to reduce the average level of inventory by $100,000. The company achieves a cost savings of $10,000 per year by using less costly materials. The company purchases machinery and equipment that increase average operating assets by $125,000.…
Contribution Margin and Contribution Margin Ratio For a recent year, McDonald's (MCD) company-owned restaurants had the following sales and expenses (in millions): Sales Food and packaging Payroll Occupancy (rent, depreciation, etc.) General, selling, and administrative expenses $18,700 $(7,497) (4,700) (3,243) (2,700) $(18,140) Operating income Assume that the variable costs consist of food and packaging, payroll, and 40% of the general, selling, and administrative expenses. a. What is McDonald's contribution margin? Round to the nearest million. (Give answer in millions of dollars.) million b. What is McDonald's contribution margin ratio? % $560 c. How much would operating income increase if same-store sales increased by $1,100 million for the coming year, with no change in the contribution margin ratio or fixed costs? Round your answer to the closest million. million
Required information Skip to question [The following information applies to the questions displayed below.] Westerville Company reported the following results from last year's operations: Sales $ 1,500,000 Variable expenses 730, 000 Contribution margin 770, 000 Fixed expenses 470,000 Net operating income $ 300,000 Average operating assets $ 937,500 At the beginning of this year, the company has a $362, 500 investment opportunity with the following cost and revenue characteristics: Sales $ 580,000 Contribution margin ratio 70% of sales Fixed expenses $ 319,000 The company's minimum required rate of return is 10%. 8. If the company pursues the investment opportunity and otherwise performs the same as last year, what turnover will it earn this year? (Round your answer to 2 decimal places.)
Provide Answer please provide
Laredo, Inc. has a contribution margin ratio of 55%. This month, sales revenue was $186,000, and profit was $28,000. If sales revenue increases by $45,000, by how much will profit increase? Multiple Choice $1,540 $5,500 $21,950 $24,750