Question
A firm has revenues of $120,000, a contribution margin ratio of 30%, and fixed expenses that total $56,000. If revenues increase by $20,000, then: Group
A firm has revenues of $120,000, a contribution margin ratio of 30%, and fixed expenses that total $56,000. If revenues increase by $20,000, then:
Group of answer choices
operating income will increase by $6000.
operating income will be 0.
fixed expenses will increase $8000.
the contribution margin ratio will increase by 1/8.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started
Intermediate Accounting
Authors: J. David Spiceland, James Sepe, Mark Nelson, Lawrence Tomassini
5th Edition
0077282078, 9780077282073
