What is wicker companys contribution margin ratio round to


For a recent year, Wicker Company-owned restaurants had the following sales and expenses (in millions):

Sales $19,900

Food and packaging $5,183

Payroll 5,000

Occupancy (rent, depreciation, etc.) 6,217

General, selling, and administrative expenses 2,900

$19,300

Income from operations $600

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.)

b. What is Wicker Company's contribution margin ratio? Round to one decimal place.

c. How much would income from operations increase if same-store sales increased by $1,200 million for the coming year, with no change in the contribution margin ratio or fixed costs? Round your answer to the closest million.

Solution Preview :

Prepared by a verified Expert
Accounting Basics: What is wicker companys contribution margin ratio round to
Reference No:- TGS02555345

Now Priced at $10 (50% Discount)

Recommended (93%)

Rated (4.5/5)