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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 | 2,445.2 |
17,668.9 | |
Income from operations | $ 933.6 |
Assume that the variable costs consist of food and packaging, payroll, and 40% of the general, selling, and administrative expenses.
Answer the following questions:
- What is McDonalds contribution margin? (Round your answer to the nearest tenth of one decimal place.)
- What is McDonalds contribution margin ratio? (Round your answer to one decimal place.)
- 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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