Question
For a recent year, McDonalds company-owned restaurants had the following sales and expenses ( in millions) : Sales 18,602.5 Food and Packaging 6,318.2 Payroll 4,710.3
For a recent year, McDonalds company-owned restaurants had the following sales and expenses ( in millions) :
Sales 18,602.5
Food and Packaging 6,318.2
Payroll 4,710.3
Occupancy (rent, depreciation, etc) 4,195.2
General, selling, and administrative expenses 2,445.2
Income from operations 933.6
(ASSUME THAT THE VARIABLE COSTS CONSIT OF FOOD AND PACKAGING, PAYROLL, AND 40% OF THE GENERAL, SELLING AND ADMINISTRATIVE EXPENSES)
A. What is McDonalds contribution margin? Round to the nearest tenth of a million (one decimal place)
B. What is McDonalds Contribution margin ratio? Round to one decimal place.
C. How much would income from operations increase if same-store sales increased by $900 million for the coming year, with no change in the contribution margin ratio or fixed costs? Round your answer to the nearest tenth of a million. ( one decimal place)
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