eBook 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 $279,000 Food and paper $74,140 Payroll and employee benefits 66,700 Occupancy and other expenses 60,600 Selling, general, and administrative expenses 38,500 Other operating expenses 16,740 Net operating expenses (256,680) Operating income (loss) $22,320 Assume that the variable costs consist of food and paper, payroll and employee benefits, and 40% of the selling, general, and administrative expenses. a. What is McDooley's contribution margin? $fill in the blank 1 b. What is McDooley's contribution margin ratio? Round your percentage answer to one decimal place. fill in the blank 2 % c. How much would operating income increase if the stores sales increased by $5,600 for the coming year, with no change in the contribution margin ratio or fixed costs? $fill in the blank 3 d. What would have been the operating income or loss for the recent year if sales had been $5,600 more? $fill in the blank 4
eBook 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 $279,000 Food and paper $74,140 Payroll and employee benefits 66,700 Occupancy and other expenses 60,600 Selling, general, and administrative expenses 38,500 Other operating expenses 16,740 Net operating expenses (256,680) Operating income (loss) $22,320 Assume that the variable costs consist of food and paper, payroll and employee benefits, and 40% of the selling, general, and administrative expenses. a. What is McDooley's contribution margin? $fill in the blank 1 b. What is McDooley's contribution margin ratio? Round your percentage answer to one decimal place. fill in the blank 2 % c. How much would operating income increase if the stores sales increased by $5,600 for the coming year, with no change in the contribution margin ratio or fixed costs? $fill in the blank 3 d. What would have been the operating income or loss for the recent year if sales had been $5,600 more? $fill in the blank 4
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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eBook
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 $279,000 Food and paper $74,140 Payroll and employee benefits 66,700 Occupancy and other expenses 60,600 Selling, general, and administrative expenses 38,500 Other operating expenses 16,740 Net operating expenses (256,680) Operating income (loss) $22,320
Assume that the variable costs consist of food and paper, payroll and employee benefits, and 40% of the selling, general, and administrative expenses.
a. What is McDooley's contribution margin?
$fill in the blank 1b. What is McDooley's contribution margin ratio? Round your percentage answer to one decimal place.
fill in the blank 2 %c. How much would operating income increase if the stores sales increased by $5,600 for the coming year, with no change in the contribution margin ratio or fixed costs?
$fill in the blank 3d. What would have been the operating income or loss for the recent year if sales had been $5,600 more?
$fill in the blank 4
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