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Unformatted text preview: the impact on net operating income of any given dollar change in total sales can be computed by simply Definitions applying the CM ratio to the dollar change. For example, if Roddick Enterprises plans a $600 increase in sales during the coming month, the contribution margin will increase by $400 ($600 increase in sales CM ratio of 66.7%). As we noted above, net operating income will also increase by $400. Assuming fixed cost remains unchanged....
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- Spring '11
- Managerial Accounting