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Target Operating Income Using the Contribution Margin Method 7 A target operating income contribution computation allows the manager 8 to determine how many procedures must
Target Operating Income Using the Contribution Margin Method 7 A target operating income contribution computation allows the manager 8 to determine how many procedures must be performed in order to yield a particular operating income. 11 The formula is compute this is: NE Fixed Costs + Target Operating Income Contribution Margin Per Unit 16 Assumptions: 3,800 150 A. Desired (target) operating income = B. Revenue per Procedure C. Variable Cost Per Unit D. Total Fixed Cost 3,000 24 Calculate the Target Operating Income
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