Contribution margin ratio basics

Reference no: EM13153676

Mitch Corporation's contribution margin ratio is 14% and its fixed monthly expenses are $87,000. If the company's sales for a month are $678,000, what is the best estimate of the company's net operating income? Assume that the fixed monthly expenses do not change.

a. $94,920

b. $591,000

c. $7,920

d. $496,080

Reference no: EM13153676

Questions Cloud

Explaining a process : one that explains clearly how to do or make something in a series of steps carried out in a definite order. In this case, Please explain how to bathe a dog.

Total cash provided by operating activities : Wilton Company reported net income of $50,000 for the year. During the year, accounts receivable decreased by $7,000, accounts payable increased by $3,000 and depreciation expense of $5,000 was recorded. Net cash provided by operating activities f..

Explain the many ways transaction costs are problematic : Explain the many ways transaction costs are problematic in financial markets. As part of your response give an actual example with a numerical breakdown that illustrates this problem.

Compare and contrast the demise of the accounting firm : Compare and contrast the demise of the accounting firm of Arthur Andersen with the failures evident in the recent Subprime Financial crisis. What lessons can be learned from these failures?

Contribution margin ratio basics : Mitch Corporation's contribution margin ratio is 14% and its fixed monthly expenses are $87,000. If the company's sales for a month are $678,000, what is the best estimate of the company's net operating income? Assume that the fixed monthly expens..

Illustrate the role of supply-chain management in the global : Illustrate the role of supply-chain management in the global movement of goods from one country to another, and explain its overall impact on local trade. Support your answer with examples of such an impact in action.

The value of the investment in ten years : If 1000 dollars were invested now at a 12% rate componded annually what would be the value of the investment in teonyears

The bank compounds interest : Assume that 1 year from now; you will deposit $1,000 into a savings account that pays 8%. a. If the Bank compounds interest annually, how much will you have in your account 4 years from now?

John''s locomotive works manufactures : John's Locomotive Works manufactures a model locomotive. It comes in two versions--a standard (X1), and a deluxe (X2). The standard version generates $250 per locomotive for the standard version, and $350 per locomotive for the deluxe version. One co..

User Account

All Pages