Nolan dry cleaners has determined the following about its costs: total variable expenses are $40,000, total fixed expenses are $30,000, and the sales revenue needed to break even is $40,000. determine the company's current 1) sales revenue and 2) operating income. (hint: first, find the contribution margin ratio; then prepare the contribution margin income statement.)

Operating income= 40,000

Explanation:

Giving the following information:

Total variable expenses are $40,000, total fixed expenses are $30,000, and the sales revenue needed to break even is $40,000.

Sales= operating income + fixed costs + variable costs

Sales= 40,000 + 30,000 + 40,000= 110,000

Operating income:

Sales= 110,000

Variable costs= 40,000

Gross profit= 70,000

Fixed costs= 30,000

Operating income= 40,000

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