Contribution Margin Ratio a. Young Company budgets sales of $950,000, fixed costs of $40,600, and...
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Contribution Margin Ratio a. Young Company budgets sales of $950,000, fixed costs of $40,600, and variable costs of $180,500. What is the contribution margin ratio for Young Company? b. If the contribution margin ratio for Martinez Company is 45%, sales were $527,000, and fixed costs were $184,980, what was the operating income? 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 $29,500 Food and packaging $(8,580) Payroll (7,400) Occupancy (rent, depreciation, etc.) (8,340) General, selling, and administrative expenses (4,300) $(28,620) Operating income $880 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 million. (Give answer in millions of dollars.) million b. What is McDonald's contribution margin ratio? C. How much would operating income increase if same-store sales increased by $1,800 million for the coming year, with no change in the contribution margin ratio or fixed costs? Round your answer to the closest million. million
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