Question
Serie Incorporated reported the following results from last years operations: Sales $ 16,800,000 Variable expenses 10,640,000 Contribution margin 6,160,000 Fixed expenses 5,488,000 Net operating income
Serie Incorporated reported the following results from last years operations: Sales $ 16,800,000 Variable expenses 10,640,000 Contribution margin 6,160,000 Fixed expenses 5,488,000 Net operating income $ 672,000 Average operating assets $ 7,000,000 At the beginning of this year, the company has a $2,100,000 investment opportunity with the following characteristics: Sales $ 2,520,000 Contribution margin ratio 50% of sales Fixed expenses $ 1,108,800 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:
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