Print Item JNOW Mê How 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 $15,295.0 Food and packaging $(4,896.9) Payroll (4,134.2) Occupancy (rent, depreciation, etc.) (3,667.7) General, selling, and administrative expenses (2,384.5) $(15,083.3) Operating income $211.7 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 tenth of a million (one decimal place). million b. What is McDonald's contribution margin ratio? Round to one decimal place. c. How much would operating income increase if same-store sales increased by $800 million for the coming year, with no change in the contribution margin ratio or fixed costs? Round your answer to the nearest tenth of a million (one decimal place). million

Print Item JNOW Mê How 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 $15,295.0 Food and packaging $(4,896.9) Payroll (4,134.2) Occupancy (rent, depreciation, etc.) (3,667.7) General, selling, and administrative expenses (2,384.5) $(15,083.3) Operating income $211.7 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 tenth of a million (one decimal place). million b. What is McDonald's contribution margin ratio? Round to one decimal place. c. How much would operating income increase if same-store sales increased by $800 million for the coming year, with no change in the contribution margin ratio or fixed costs? Round your answer to the nearest tenth of a million (one decimal place). million

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FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

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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 $15,295.0 $(4,896.9) (4,134.2) (3,667.7) (2,384.5) $(15,083.3) $211.7 Operating income Assume that the variable costs consist of food and packaging, payroll, and 40% of the general, selling, and administrative exp a. What is McDonald's contribution margin? Round to the nearest tenth of a million (one decimal place). $5,776.6 X million b. What is McDonald's contribution margin ratio? Round to one decimal place. 37.77 X % I. How much would operating income increase if same-store sales increased by $800 million for the coming year, with no ch= margin ratio or fixed costs? Round your answer to the nearest tenth of a million (one decimal place). 277.6 million Feedback
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Revenue and expense data for the current calendar year for Tannenhill Company and for the electronics industry are as follows. Tannenhill’s data are expressed in dollars. The electronics industry averages are expressed in percentages. TannenhillCompany ElectronicsIndustryAverage Sales $800,000 100 % Cost of goods sold 512,000 70 Gross profit $288,000 30 % Selling expenses $176,000 17 % Administrative expenses 64,000 7 Total operating expenses $240,000 24 % Operating income $48,000 6 % Other revenue 16,000 2 $64,000 8 % Other expense 8,000 1 Income before income tax $56,000 7 % Income tax expense 24,000 5 Net income $32,000 2 % a. Prepare a common-sized income statement comparing the results of operations for Tannenhill Company with the industry average. If required, round percentages to one decimal place. Enter all amounts as positive numbers.