Carole Grand and Bonnie Lamore Run a Shuttle Service from Western

question 365

Multiple Choice

Carole Grand and Bonnie Lamore run a shuttle service from Western Illinois to the busy Chicago O'Hare airport.Last month,they recorded the following: If 25% of their net income is paid to the government in taxes,what is their net income after taxes?

• A) $1410.00
• B) $1160.00
• C) $682.00
• D) $870.00

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Definitions:

Margin of Safety

This metric calculates how much sales can decline before a business reaches its breakeven point.

Total Contribution Margin

The total amount remaining from sales revenue after all variable costs are deducted, used to cover fixed costs and profit.

Margin of Safety

The difference between actual sales and the break-even point, indicating the amount by which sales can drop before the business incurs a loss.

Capital Intensive

A business process or industry that requires large amounts of money and financial resources to produce a good or service.