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Headland offers computer consulting, training, and repair services. For the most recent fiscal year, profit was $416,200, as follows: Total Consulting $593,500 Training $564,300 Repair
Headland offers computer consulting, training, and repair services. For the most recent fiscal year, profit was $416,200, as follows: Total Consulting $593,500 Training $564,300 Repair $405,200 Sales $1,563,000 Less variable costs: Salaries Supplies/parts Other 306,900 22,100 203,100 40,400 2,800 225,100 68,100 5,000 735,100 130,600 9,200 1,400 $263,100 $318,000 $107,000 688,100 Contribution margin Less common fixed costs: Rent Owner's salary Utilities 54,700 194,100 13,000 10,100 $416,200 Other Profit Linda O'Flaherty, the owner of Headland, believes that in the coming year, she can increase sales by 18 percent. Assuming the current mix of services, what will be the percentage increase in profit associated with a 18 percent increase in sales? (Round weighted-average contribution margin ratio to 6 decimal places, e.g. O.124547 and final answer to 2 decimal places, e.g. 15.25%.) Increase in profit %
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