Question

for franklin, inc., sales is $1,500,000, fixed expenses are $450,000, and the contribution margin ratio is 36%. what is net income?

Answer 1

The net income for Franklin, Inc., when sales are $1,500,000, fixed expenses are $450,000, and the contribution margin ratio is 36%, is $90,000.

Step-by-step explanation:

To calculate net income for Franklin, Inc., we need to first determine the total contribution margin by applying the contribution margin ratio to the sales.

The contribution margin ratio is 36%, so the total contribution margin is 36% of $1,500,000, which equals to $540,000. To find the net income, we subtract the fixed expenses from the contribution margin.

Therefore, the net income would be $540,000 (contribution margin) - $450,000 (fixed expenses) = $90,000.