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Sedbober [7]
3 years ago
5

For a recent year, McDonald's Company-owned restaurants had the following sales and expenses (in millions): Sales $25,700 Food a

nd packaging $8,982 Payroll 6,500 Occupancy (rent, depreciation, etc.) 5,748 General, selling, and administrative expenses 3,700 $24,930 Income from operations $770 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
Business
1 answer:
Aleks [24]3 years ago
6 0

Answer:

a. $9,338

b. 0.363

Explanation:

a. Contribution Margin  = Sales - Variable Cost

Where Sales = $25,700

Variable Cost = Food & Packaging + Payroll + 40% x General, Selling and Administrative expenses

V.C. = 8,982 + 6,500 + 40% * 3,700

V.C = 8,982 + 6,500 + 1,480

= $16,362

Therefore, Contribution Margin  = Sales - Variable Cost  

= $25,700 - $16,362

=$9,338

b. McDonald's contribution margin ratio  = Contribution Margin / Sales

= $9,338 / $25,700

= 0.363

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brilliants [131]

Answer:

The correct answer is D: $13

Explanation:

Giving the following information:

Cost per Unit Cost per Period:

Direct materials $ 6.20

Direct labor $ 2.80

Variable manufacturing overhead $ 1.45

Fixed manufacturing overhead $ 12,000

Sales commissions $ 1.00

Variable administrative expense $ 0.55

Fixed selling and administrative expense $ 4,000

Price= 25

Contribution margin= Price - variable costs

Variable costs= direct materials + direct labor + variable manufacturing overhead + sales commissions + variable administrative expense

Variavle costs= 6.20 + 2.80 + 1.45 + 1 + 0.55= $12

Contribution margin per unit= 25 - 12= $13

4 0
3 years ago
Heavy Metal Corporation is expected to generate the following free cash flows over the next five years.
mezya [45]

Answer:

Enterprise value of Heavy Metal= $1,080.766

Share price =  $18.945 per unit

Explanation:

<em>The value of a firm is the present value of the free cash flow discounted at the weighted average  cost of capital</em>

Year                                          PV

1        52.1 × 1.14^(-1)      = 45.70175439

2        68.6 × 1.14^(-2)  = 52.40073869

3          78.6 × 1.14^(-3) = 53.05276117

4         74.4×  1.14^(-4) = 44.05077264

5          81.1 ×  1.14^(-5) = 42.12079868

Year  and beyond

  81.1 × 1.04/(0.14-0.04) = 843.44

Total value =   45.70+ 52.40+53.052 + 44.050 +42.120+  843.44 = 1080.766826

Enterprise value of Heavy Metal= $1,080.766

Share price = Total value - Debt value / number of shares

=  (1,080.766  - 304 )/ 41 million units= $18.945 per unit

Share price =  $18.945 per unit

4 0
3 years ago
Air Destinations issues bonds due in 10 years with a stated interest rate of 11% and a face value of $500,000. Interest payments
olga nikolaevna [1]

Answer: $471,324.61

Explanation:

Price of a bond = Present value of coupon payments + Present value of face value at maturity

Coupon payments = 500,000 * 11% * 1/2 years = $27,500

Periodic yield = 12%/ 2 = 6% per semi annual period

Periods = 10 * 2 = 20 semi annual periods

Coupon payment is constant so it is an annuity.

Price of bond = Present value of annuity + Present value of face value at maturity

= (Annuity * Present value interest factor of Annuity, 6%, 20 years) + Face value / (1 + rate) ^ number of periods

= (27,500 * 11.4699) + 500,000 / (1 + 6%)²⁰

= $471,324.61

8 0
2 years ago
Bauer Manufacturing uses departmental cost driver rates to allocate manufacturing overhead costs to products. Manufacturing over
Diano4ka-milaya [45]

Answer:

Instructions are listed below.

Explanation:

Giving the following information:

Manufacturing overhead costs are allocated based on machine-hours in the Machining Department and based on direct labor-hours in the Assembly Department.

Machining:

Machine-hours= 50,000

Manufacturing overhead costs= $ 280,000

Assembly:

Direct labor-hours= 40,000

Manufacturing overhead costs= $ 360,000

First, we need to calculate the estimated overhead rate for each department:

To calculate the estimated manufacturing overhead rate we need to use the following formula:

Estimated manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base

<u>Machining:</u>

Estimated manufacturing overhead rate= 280,000/50,000= $5.6 per machine hour

<u>Assembly:</u>

Estimated manufacturing overhead rate= 360,000/40,000= $9 per direct labor hour

Now, we can allocate overhead to Job 316:

Machining Assembly

Direct labor-hours 120 75

Machine-hours 45 5

Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base

Machining:

Allocated MOH= 5.6*45= $252

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3 years ago
following organizations provides CI functional services and analysis in support of international arms control agreements
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Director, National security agency chief, central security service DIRNSA/CHCSS provides CI functional services and analysis in support of international arms control agreements.

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4 0
1 year ago
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