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Posted: January 5th, 2025
For a recent year, McDonaldâs company-owned restaurants had the following sales
For a recent year, McDonaldâs company-owned restaurants had the following sales and expenses (in millions):Sales$ 18,602.5Food and packaging$ 6,318.2Payroll4,710.3Occupancy (rent, depreciation, etc.)4,195.2General, selling, and administrative2,445.217,668.9Income from operations$ 933.6Assume that the variable costs consist of food and packaging, payroll, and 40% of the general, selling, and administrative expenses.Answer the following questions:What is McDonaldâs contribution margin? (Round your answer to the nearest tenth of one decimal place.)What is McDonaldâs contribution margin ratio? (Round your answer to one decimal place.)How much would income from operations increase if same-store sales increased by $900 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]).
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