7 Maack Corporation\'s contribution margin ratio is 16% and its fixed monthly ex

Question

7 Maack Corporation's contribution margin ratio is 16% and its fixed monthly expenses are $44,000 the company's sales for a month are $299,000, what is the best estimate of the company's net operating income? Assume that the fixed monthly expenses do not change r A. $207,160 8,$3,840 sC.$255,000 D. $47,840 Bowe Corporation's fixed monthly expenses are $21,000 and its contribution margin ratio is 61%. Assuming that the fixed monthly expenses do not change, what is the best estimate of the company's net operating income in a month when sales are $74,000? 8. A. $7,860 B. $45,140 C$24,140 D. $53,000 9. Bolding Inc.'s contribution margin ratio is 61% and its fixed monthly expenses are $42,000. Assuming that the fixed monthly expenses do not change, what is the best estimate of the company's net operating income in a month when sales are $126,000? A. $76,860 B. $7.140 C) $34,860 D. $84,000

Explanation / Answer

Q7. Answer is B. $ 3840 Explanation: fixed cost: $ 44000 CM ratio: 16% Sales: $ 299,000 Contribution eared: $ 299,000 *16% = $47840 Net income: Contribution-Fixed cost = 47840-44000 =3840 Q8. Answer is C. $ 24140 Explanation: Fixedcost $ 21000 CM ratio: 61% Sales: $ 74000 Contribution: 74000*61% = 45140 Net Income: 45140 -21000 = $24,140 Q9. Answer is C. $ 34860 Explanation: Fixed cost: $ 42,000 CM ratio: 61% Sales: $ 126000 Contribution: 126,000 *61% = $ 76,860 Net Income: 76860 -42000 =$ 34860

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