Contribution Margin and Contribution Margin Ratio For a recent year, Wicker Company-owned restaurants had the following sales and expenses (in millions): Sales Food and packaging $28,900 $8,649 Payroll 7,300 Occupancy (rent, depreciation, 7,881 etc.) General, selling, and 4,200 administrative expenses $28,030 $870 Income from operations 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.) million b. What is Wicker Company's contribution margin ratio? Round your answer to one decimal place. % c. How much would income from operations increase if same-store sales increased by $1,700 million for the coming year, with no change in the contribution margin ratio or foxed costs? Round your answer to the closest million. million
Contribution Margin and Contribution Margin Ratio For a recent year, Wicker Company-owned restaurants had the following sales and expenses (in millions): Sales Food and packaging $28,900 $8,649 Payroll 7,300 Occupancy (rent, depreciation, 7,881 etc.) General, selling, and 4,200 administrative expenses $28,030 $870 Income from operations 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.) million b. What is Wicker Company's contribution margin ratio? Round your answer to one decimal place. % c. How much would income from operations increase if same-store sales increased by $1,700 million for the coming year, with no change in the contribution margin ratio or foxed costs? Round your answer to the closest million. million
Chapter1: Financial Statements And Business Decisions
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Transcribed Image Text:Contribution Margin and Contribution Margin Ratio
For a recent year, Wicker Company-owned restaurants had the following sales and expenses (in millions):
Sales
Food and packaging
$28,900
$8,649
Payroll
7,300
Occupancy (rent, depreciation,
7,881
etc.)
General, selling, and
4,200
administrative expenses
$28,030
$870
Income from operations
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.)
million
b. What is Wicker Company's contribution margin ratio? Round your answer to one decimal place.
%
c. How much would income from operations increase if same-store sales increased by $1,700 million for the coming year, with no change in the contribution margin ratio or foxed costs? Round your answer to the closest million.
million
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