Question
andhill offers computer consulting, training, and repair services. For the most recent fiscal year, profit was $211,600, as follows: ConsultingTrainingRepairTotal Sales$568,200$508,300$344,000$1,420,500 Less variable costs: Salaries
andhill offers computer consulting, training, and repair services. For the most recent fiscal year, profit was $211,600, as follows:
ConsultingTrainingRepairTotal
Sales$568,200$508,300$344,000$1,420,500
Less variable costs:
Salaries 327,800 212,300 237,600 777,700
Supplies/parts26,30035,10073,500134,900
Other1,3002,9004,6008,800
Contribution margin$212,800 $258,000$ 28,300 499,100
Less common fixed costs:
Rent54,900
Owner's salary208,700
Utilities13,500O
ther10,400
Profit$211,600
Linda O'Flaherty, the owner of Sandhill, believes that in the coming year, she can increase sales by 13 percent. Assuming the current mix of services, what will be the percentage increase in profit associated with a 13 percent increase in sales?(Round weighted-average contribution margin ratio to 6 decimal places, e.g. 0.124547 and final answer to 2 decimal places, e.g. 15.25%.)
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