Question

If sales are $620,000, variable costs are 35% of sales, and operating income is $160,000, what is the contribution margin ratio?

65% 35% 25% none of the above

Answer #1

ANS is 65%

The contribution margin is equal to sales revenue minus variable cost and variable expenses i.e. Contribution margin ratio is the percentage of sales that remains after all variable cost and variable expenses have been deducted from sales.

In this example variable cost is 35% of sales , that means remaining 65% is contribution margin ratio.

We can also compute 65% by following the below method.

Sales given is $ 620,000

Variable cost = 35% of sales = 35% × $620,000 = $217,000

Contribution margin = Sales - Variable cost = $620,000 - $217,000 = $403,000

We have formula for contribution margin ratio as:

Contribution margin ratio = (Contribution margin ÷ Sales) ×100 =( $403,000 ÷ $620,000)×100 = 65 %

Contribution Margin Ratio a. Yountz Company budgets sales of
$760,000, fixed costs of $47,900, and variable costs of $212,800.
What is the contribution margin ratio for Yountz Company? (Enter
your answer as a whole number.) % b. If the contribution margin
ratio for Vera Company is 65%, sales were $678,000, and fixed costs
were $326,120, what was the income from operations?

Contribution Margin Ratio a. Young Company budgets sales of
$720,000, fixed costs of $51,800, and variable costs of $230,400.
What is the contribution margin ratio for Young Company? %
b. If the contribution margin ratio for Martinez Company is 45%,
sales were $491,000, and fixed costs were $165,710, what was the
operating income?

Contribution Margin Ratio
a. Young Company budgets sales of $760,000,
fixed costs of $22,200, and variable costs of $98,800. What is the
contribution margin ratio for Young Company?
fill in the blank 1 %
b. If the contribution margin ratio for
Martinez Company is 67%, sales were $511,000, and fixed costs were
$246,510, what was the operating income?
$fill in the blank 2

If variable cost ratio to sales revenue is 35% which ratio will
be automatically 65% (100% - 35%): Select one: a. Fixed cost to
variable cost ratio b. Contribution margin ratio c. Margin of
Safety ratio d. Variable cost to fixed cost ratio

For a particular company, variable costs are 65% of sales and
the total contribution margin at the breakeven point is $227,500.
If sales volume increases by $10,000, net operating income will
increase by
A.$3,500
B.It cannot be determined from the information given
C.No choices are correct
D.It depends on whether the company is above or below the
breakeven point
E.$6,500

Ripa Company has the following data:
Sales revenue
$360,000
Variable costs
$240,000
Contribution margin
$120,000
Fixed costs
$100,000
Operating income
$ 20,000
What will the contribution margin ratio be at Ripa Company if sales
volume increases by 15%?

Which of the following is the income statement formula for the
variable costing method?
Sales Revenue - All Variable Costs = Contribution Margin - All
Fixed Expenses = Operating Income
Sales Revenue - Cost of Goods Sold = Gross Margin - All Fixed
Expenses = Operating Income
Sales Revenue - Variable Manufacturing Costs = Contribution
Margin - Fixed Manufacturing Costs = Operating Income
Sales Revenue - Cost of Goods Sold = Gross Margin - Selling and
Administrative Expenses = Operating...

a. Yountz Company budgets sales of $1,240,000,
fixed costs of $39,100, and variable costs of $173,600. What is the
contribution margin ratio for Yountz Company? (Enter your answer as
a whole number.)
%
b. If the contribution margin ratio for Vera
Company is 53%, sales were $516,000, and fixed costs were $213,310,
what was the income from operations?
$

Contribution Margin Ratio
a. Yountz Company budgets sales of $730,000,
fixed costs of $49,300, and variable costs of $219,000. What is the
contribution margin ratio for Yountz Company? (Enter your answer as
a whole number.)
%
b. If the contribution margin ratio for Vera
Company is 41%, sales were $781,000, and fixed costs were $233,750,
what was the income from operations?
$

1. Yountz Company budgets sales of $1,190,000, fixed costs of
$50,900, and variable costs of $226,100. What is the contribution
margin ratio for Yountz Company? (Enter your answer as a whole
number.)
2. If the contribution margin ratio for Vera Company is 53%,
sales were $738,000, and fixed costs were $285,530, what was the
income from operations?

ADVERTISEMENT

Get Answers For Free

Most questions answered within 1 hours.

ADVERTISEMENT

asked 2 minutes ago

asked 10 minutes ago

asked 11 minutes ago

asked 11 minutes ago

asked 17 minutes ago

asked 23 minutes ago

asked 27 minutes ago

asked 32 minutes ago

asked 32 minutes ago

asked 52 minutes ago

asked 53 minutes ago

asked 57 minutes ago