Contribution Margin and Contribution Margin Ratio For a recent year, Wicker Company-owned restaurants had the following sales and expenses (in millions): Sales $22,500 Food and packaging $8,955 Payroll 5,700 Occupancy (rent, depreciation, etc.) 3,875 General, selling, and administrative expenses 3,300 $21,830 Income from operations $670 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.) $fill in the blank 1 million b. What is Wicker Company's contribution margin ratio? Round your answer to one decimal place. fill in the blank 2 % c. How much would income from operations increase if same-store sales increased by $1,400 million for the coming year, with no change in the contribution margin ratio or fixed costs? Round your answer to the closest million. $fill in the blank 3 million
Contribution Margin and Contribution Margin Ratio
For a recent year, Wicker Company-owned restaurants had the following sales and expenses (in millions):
Sales | $22,500 |
Food and packaging | $8,955 |
Payroll | 5,700 |
Occupancy (rent, depreciation, etc.) | 3,875 |
General, selling, and administrative expenses | 3,300 |
$21,830 | |
Income from operations | $670 |
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.)
$fill in the blank 1 million
b. What is Wicker Company's contribution margin ratio? Round your answer to one decimal place.
fill in the blank 2 %
c. How much would income from operations increase if same-store sales increased by $1,400 million for the coming year, with no change in the contribution margin ratio or fixed costs? Round your answer to the closest million.
$fill in the blank 3 million
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