Contribution Margin and Contribution Margin Ratio For a recent year, Wicker Company-owned restaurants had the following sales and expenses (in millions): Sales $15,200 Food and packaging $4,592 Payroll 3,800 Occupancy (rent, depreciation, etc.) 4,148 General, selling, and administrative expenses 2,200 $14,740 Income from operations $460 Assume that the variable costs consist of food and packaging, payroll, and 40% of the general, selling, and administrative expenses. a. What is Wicker Company's contribution margin? Round to the nearest million. (Give answer in millions of dollars.) $fill in the blank b. What is Wicker Company's contribution margin ratio? Round to one decimal place. fill in the blank c. How much would income from operations increase if same-store sales increased by $900 million for the coming year, with no change in the contribution margin ratio or fixed costs? Round your answer to the closest million. $fill in the blank million
Contribution Margin and Contribution Margin Ratio For a recent year, Wicker Company-owned restaurants had the following sales and expenses (in millions): Sales $15,200 Food and packaging $4,592 Payroll 3,800 Occupancy (rent, depreciation, etc.) 4,148 General, selling, and administrative expenses 2,200 $14,740 Income from operations $460 Assume that the variable costs consist of food and packaging, payroll, and 40% of the general, selling, and administrative expenses. a. What is Wicker Company's contribution margin? Round to the nearest million. (Give answer in millions of dollars.) $fill in the blank b. What is Wicker Company's contribution margin ratio? Round to one decimal place. fill in the blank c. How much would income from operations increase if same-store sales increased by $900 million for the coming year, with no change in the contribution margin ratio or fixed costs? Round your answer to the closest million. $fill in the blank million
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Contribution Margin and Contribution Margin Ratio
For a recent year, Wicker Company-owned restaurants had the following sales and expenses (in millions):
| Sales | $15,200 |
| Food and packaging | $4,592 |
| Payroll | 3,800 |
| Occupancy (rent, |
4,148 |
| General, selling, and administrative expenses | 2,200 |
| $14,740 | |
| Income from operations | $460 |
Assume that the variable costs consist of food and packaging, payroll, and 40% of the general, selling, and administrative expenses.
a. What is Wicker Company's contribution margin? Round to the nearest million. (Give answer in millions of dollars.)
$fill in the blank
b. What is Wicker Company's contribution margin ratio? Round to one decimal place.
fill in the blank
c. How much would income from operations increase if same-store sales increased by $900 million for the coming year, with no change in the contribution margin ratio or fixed costs? Round your answer to the closest million.
$fill in the blank million
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