Question
For a recent year, McDonalds (MCD) company-owned restaurants had the following sales and expenses (in millions): Sales $16,200 Food and packaging $(5,308) Payroll (4,100) Occupancy
For a recent year, McDonalds (MCD) company-owned restaurants had the following sales and expenses (in millions):
Sales | $16,200 |
Food and packaging | $(5,308) |
Payroll | (4,100) |
Occupancy (rent, depreciation, etc.) | (3,902) |
General, selling, and administrative expenses | (2,400) |
$(15,710) | |
Operating income | $490 |
Assume that the variable costs consist of food and packaging, payroll, and 40% of the general, selling, and administrative expenses.
a. What is McDonald's contribution margin? Round to the nearest million. (Give answer in millions of dollars.) $ _____________
b. What is McDonald's contribution margin ratio? ________________%
c. How much would operating income increase if same-store sales increased by $1,000 million for the coming year, with no change in the contribution margin ratio or fixed costs? Round your answer to the closest million. $ __________________
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