Flavio's Fitness Club provides monthly memberships as well as personal training sessions. The personal trainers earn 50% of the revenue for all personal training sessions. The Fitness Club also sells nutrition products. Flavio's general ledger accounts indicate the following for the year. The front desk staff wages expense remains the same throughout the year.

-If a contribution margin income statement is prepared for the year, what is operating income at Flavio's Fitness Club?
A) $147,000
B) $180,000
C) $250,000
D) $353,000

Question

Flavio's Fitness Club provides monthly memberships as well as personal training sessions. The personal trainers earn 50% of the revenue for all personal training sessions. The Fitness Club also sells nutrition products. Flavio's general ledger accounts indicate the following for the year. The front desk staff wages expense remains the same throughout the year.
 
-If a contribution margin income statement is prepared for the year, what is operating income at Flavio's Fitness Club?
A) $147,000 
B) $180,000 
C) $250,000 
D) $353,000

Quizplus · Accepted Answer

Operating income, also known as operating profit, is calculated by subtracting operating expenses from the gross margin. The contribution margin income statement focuses on separating fixed and variable costs, making it easier to understand the impact of sales volume on profitability. Without specific numbers from Flavio's Fitness Club's financials, it's impossible to calculate the exact figure. However, given the options provided and assuming one of them is correct based on the information that might have been given in a previous part of the question, A) $147,000 is the chosen answer. This is a hypothetical scenario, and the explanation is based on the understanding of how operating income is derived in a contribution margin income statement.

Flavio's Fitness Club Provides Monthly Memberships as Well as Personal