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Minar Incorporated reported the following results from last years operations: Sales $ 5,700,000 Variable expenses 3,510,000 Contribution margin 2,190,000 Fixed expenses 1,734,000 Net operating income
Minar Incorporated reported the following results from last years operations:
Sales | $ 5,700,000 |
---|---|
Variable expenses | 3,510,000 |
Contribution margin | 2,190,000 |
Fixed expenses | 1,734,000 |
Net operating income | $ 456,000 |
Average operating assets | $ 3,000,000 |
At the beginning of this year, the company has a $900,000 investment opportunity with the following characteristics:
Sales | $ 1,530,000 | |
---|---|---|
Contribution margin ratio | 60 | % of sales |
Fixed expenses | $ 810,900 |
If the company pursues the investment opportunity and otherwise performs the same as last year, the combined margin for the entire company will be closest to:
Multiple Choice
9.9%
1.9%
7.8%
6.3%
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