For a recent year, McDonald's (MCD) company-owned restaurants had the following sales and expenses (in millions): Sales Food and paper Payroll and employee benefits Occupancy and other expenses General, selling, and administrative expenses $19,207.8 $(2,564.2) (2,416.4) (4,357.6) (2,545.6) $(11,883.8) $7,324.0 Operating income Assume that the variable costs consist of food and paper, payroll, 25% of occupancy and other expenses, and 40% of the general, selling, and administrative expenses. a. What is McDonald's contribution margin? Round to the nearest tenth of a million (one decimal place). million b. What is McDonald's contribution margin ratio? Round to one decimal place. % c. How much would operating income increase if same-store sales increased by $800 million for the coming year, with no change in the contribution margin ratio or fixed costs? Round your answer to the nearest tenth of a million (one decimal place). million

For a recent year, McDonald's (MCD) company-owned restaurants had the following sales and expenses (in millions): Sales Food and paper Payroll and employee benefits Occupancy and other expenses General, selling, and administrative expenses $19,207.8 $(2,564.2) (2,416.4) (4,357.6) (2,545.6) $(11,883.8) $7,324.0 Operating income Assume that the variable costs consist of food and paper, payroll, 25% of occupancy and other expenses, and 40% of the general, selling, and administrative expenses. a. What is McDonald's contribution margin? Round to the nearest tenth of a million (one decimal place). million b. What is McDonald's contribution margin ratio? Round to one decimal place. % c. How much would operating income increase if same-store sales increased by $800 million for the coming year, with no change in the contribution margin ratio or fixed costs? Round your answer to the nearest tenth of a million (one decimal place). million

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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For a recent year, McDonald's (MCD) company-owned restaurants had the following sales and expenses (in millions): Sales by company operated restaurants   $12,719 Food and paper   $4,034 Payroll and employee benefits 3,529 Occupancy and other expenses 2,848 Selling, general, and administrative expenses    2,231 Other operating income (1,163) Net operating expenses (11,479) Operating income (loss) $1,240 Assume that the variable costs consist of food and paper, payroll and employee benefits, and 35% of the selling, general, and administrative expenses. a. What is McDonald's contribution margin? Enter your answer in million, rounded to the nearest million. _____________million b. What is McDonald's contribution margin ratio? Round your percentage answer to one decimal place.______________ % c. Use the rounded contribution margin ratio value to answer the following question: how much would operating income increase if same-store sales increased by…
For a recent year, McDonald's (MCD) company-owned restaurants had the following sales and expenses (in millions): Sales by company operated restaurants   $12,719 Food and paper   $4,034 Payroll and employee benefits 3,529 Occupancy and other expenses 2,848 Selling, general, and administrative expenses    2,231 Other operating income (1,163) Net operating expenses (11,479) Operating income (loss) $1,240 Assume that the variable costs consist of food and paper, payroll and employee benefits, and 35% of the selling, general, and administrative expenses. a. What is McDonald's contribution margin? Enter your answer in million, rounded to the nearest million. b. What is McDonald's contribution margin ratio? Round your percentage answer to one decimal place. c. Use the rounded contribution margin ratio value to answer the following question: how much would operating income increase if same-store sales increased by $250 million for the coming year, with…
For a recent year, McDonald's (MCD) company-owned restaurants had the following sales and expenses (in millions): Sales   $16,488 Food and packaging   $5,552 Payroll 4,400 Occupancy (rent, depreciation, etc.) 4,025 General, selling, and admin. expenses    2,434 Other expense 209 Total expenses (16,620) Operating income (loss) $(132) Assume that the variable costs consist of food and packaging, payroll, and 45% of the general, selling, and administrative expenses. a. What is McDonald's contribution margin? Enter your answer in million, rounded to one decimal place. $ million b. What is McDonald's contribution margin ratio? Round your percentage answer to one decimal place.% c. Use the rounded contribution margin ratio value to answer the following question: how much would operating income increase if same-store sales increased by $500 million for the coming year, with no change in the contribution margin ratio or fixed costs? $ million d. What…
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For a recent year, McDonald's (MCD) company-owned restaurants had the following sales and expenses (in millions): Sales Food and paper Payroll and employee benefits Occupancy and other expenses $21,000 $(2,600) (2,000) (4,200) General, selling, and administrative expenses (3,200) $(12,000) $9,000 Operating income Assume that the variable costs consist of food and paper, payroll, 25% of occupancy and other expenses, and 40% of the general, selling, and administrative expenses. a. What is McDonald's contribution margin? X million b. What is McDonald's contribution margin ratio? Round to one decimal place. x % c. How much would operating income increase if same-store sales increased by $1,000 million for the coming year, with no change in the contribution margin ratio or fixed costs? Round your answer to the nearest tenth of a million (one decimal place). X million
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For a recent year, McDonald’s (MCD) company-owned restaurants had the following sales and expenses (in millions): Line Item Description Amount Sales $21,000 Food and paper $(2,700) Payroll and employee benefits (2,200) Occupancy and other expenses (4,300) General, selling, and administrative expenses (4,800) Total $(14,000) Operating income $7,000 Assume that the variable costs consist of food and paper, payroll, 25% of occupancy and other expenses, and 40% of the general, selling, and administrative expenses. a. What is McDonald's contribution margin?fill in the blank 1 of 1$ million b. What is McDonald's contribution margin ratio? Round to one decimal place.fill in the blank 1 of 1 % c. How much would operating income increase if same-store sales increased by $800 million for the coming year, with no change in the contribution margin ratio or fixed costs? Round your answer to the nearest tenth of a million (one decimal place).fill in the blank 1 of 1$ million
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Contribution margin and contribution margin ratio For a recent year, McDonald’s (MCD) company-owned restaurants had the following sales and expenses (in millions): Line Item Description Amount Sales $19,207.8 Food and paper $(2,564.2) Payroll and employee benefits (2,416.4) Occupancy and other expenses (4,357.6) General, selling, and administrative expenses (2,545.6) Total $(11,883.8) Operating income $7,324.0 Assume that the variable costs consist of food and paper, payroll, 25% of occupancy and other expenses, and 40% of the general, selling, and administrative expenses. a. What is McDonald's contribution margin? Round to the nearest tenth of a million (one decimal place). b. What is McDonald's contribution margin ratio? Round to one decimal place. c. How much would operating income increase if same-store sales increased by $800 million for the coming year, with no change in the contribution margin ratio or fixed costs? Round your answer to the nearest tenth…
For a recent year, McDonald’s (MCD) company-owned restaurants had the following sales and expenses (in millions): Sales $28,400 Food and packaging $(10,472) Payroll (7,200) Occupancy (rent, depreciation, etc.) (5,778) General, selling, and administrative expenses (4,100) $(27,550) Operating income $850 Assume that the variable costs consist of food and packaging, payroll, and 40% of the general, selling, and administrative expenses.
For a recent year, McDonald's company-owned restaurants had the following sales and expenses (in millions): Sales $12,718.9 Food and packaging $ 4,033.5 Payroll 3,528.5 Occupancy (rent, depreciation, etc.) 2,847.6 General, selling, and administrative expenses 2,231.3 12,640.9 Income from operations $ 78.0 Assume that the variable costs consist of food and packaging; payroll; and 40% of the general, selling, and administrative expenses. a. What is McDonald's contribution margin? Round to the nearest tenth of a million (one decimal place). $fill in the blank 1 million b. What is McDonald's contribution margin ratio? Round your answer to one decimal place. fill in the blank 2 % c. How much would income from operations increase if same-store sales increased by $500 million for the coming year, with no change in the contribution margin ratio or fixed costs? Round your answer to the nearest tenth of a million (one decimal place). $fill in the blank 3 million Check My Work
For a recent year, McDonald's company-owned restaurants had the following sales and expenses (in millions): Sales $12,718.9 Food and packaging $ 4,033.5 Payroll 3,528.5 Occupancy (rent, depreciation, etc.) 2,847.6 General, selling, and administrative expenses 2,231.3 12,640.9 Income from operations $ 78.0 Assume that the variable costs consist of food and packaging; payroll; and 40% of the general, selling, and administrative expenses. a. What is McDonald's contribution margin? Round to the nearest tenth of a million (one decimal place).$ million b. What is McDonald's contribution margin ratio? Round your answer to one decimal place. % c. How much would income from operations increase if same-store sales increased by $500 million for the coming year, with no change in the contribution margin ratio or fixed costs? Round your answer to the nearest tenth of a million (one decimal place).$ million