For a recent year, McDugal's company-owned restaurants had the following sales and expenses (in millions): Sales $40,300
Fantastic news! We've Found the answer you've been seeking!
Question:
For a recent year, McDugal's company-owned restaurants had the following sales and expenses (in millions):
Sales | | $40,300 |
Food and packaging | $14,224 | |
Payroll | 10,700 | |
Occupancy (rent, depreciation, etc.) | 9,176 | |
General, selling, and admin. expenses | 6,200 | |
Other expense | 810 | |
Total expenses | | (41,110) |
Operating income (loss) | | $(810) |
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? Enter your answer in million, rounded to one decimal place.b. What is McDonald's contribution margin ratio? Round your percentage answer to one decimal place.
c. How much would operating income increase if same-store sales increased by $2,400 million for the coming year, with no change in the contribution margin ratio or fixed costs?
d. What would have been the operating income or loss for the recent year if sales had been $2,400 million more?
e. To achieve break even for the recent year, by how much would sales need to increase? Enter your answer in million rounded to the nearest whole number.
Related Book For
Accounting
ISBN: 978-1337899451
27th edition
Authors: Carl S. Warren, James M. Reeve, Jonathan Duchac
Posted Date: