Question
Youns Inc. reported the following results from last year's operations: Sales $ 10,500,000 Variable expenses 6,610,000 Contribution margin 3,890,000 Fixed expenses 3,260,000 Net operating income
- Youns Inc. reported the following results from last year's operations:
Sales | $ | 10,500,000 |
Variable expenses |
| 6,610,000 |
Contribution margin |
| 3,890,000 |
Fixed expenses |
| 3,260,000 |
Net operating income | $ | 630,000 |
The company's average operating assets were $5,000,000.
At the beginning of this year, the company has a $1,400,000 investment opportunity that involves sales of $2,800,000, fixed expenses of $616,000, and a contribution margin ratio of 30% of sales.
If the company pursues the investment opportunity and otherwise performs the same as last year, the combined turnover for the entire company will be closest to:
A) 9.50
B) 1.64
C) 2.66
D) 2.08
Show solution
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started