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Mitchell Corporation's fixed monthly expenses are $35,000 and its contribution margin ratio is 60%. Assuming that the fixed monthly expenses do not change, what is the best estimate of the company's net operating income in a month when sales are $120,000? a. $37,000 b. $72,000 c. $85,000 d. $37,500

Mitchell Corporation's fixed monthly expenses are $35,000 and its contribution margin ratio is 60%. Assuming that the fixed monthly expenses do not change, what is the best estimate of the company's net operating income in a month when sales are $120,000? a. $37,000 b. $72,000 c. $85,000 d. $37,500

Principles of Accounting Volume 2
Principles of Accounting Volume 2
19th Edition
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax
Chapter3: Cost-volume-profit Analysis
Section: Chapter Questions
Problem 23MC: If a firm has a contribution margin of $78M90 and a net income of $13,700 for the current month,...
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Mitchell Corporation's fixed monthly expenses are $35,000 and its contribution margin ratio is 60%. Assuming that the fixed monthly expenses do not change, what is the best estimate of the company's net operating income in a month when sales are $120,000? a. $37,000 b. $72,000 c. $85,000 d. $37,500
Transcribed Image Text:Mitchell Corporation's fixed monthly expenses are $35,000 and its contribution margin ratio is 60%. Assuming that the fixed monthly expenses do not change, what is the best estimate of the company's net operating income in a month when sales are $120,000? a. $37,000 b. $72,000 c. $85,000 d. $37,500
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