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The Linens Department of the Krafton Department Store had sales of $282,000, cost of goods sold...

The Linens Department of the Krafton Department Store had sales of $282,000, cost of goods sold of $173,500, indirect expenses of $19,875, and direct expenses of $41,250 for the current period. What is the Linens Department's contribution to overhead as a percent of sales?

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Answer #1
Contribution to overheads as a percentage to sales = 23.85%
Sales - Cost of goods sold - Direct Expenses = Contribution to overheads
$2,82,000 - $1,73,500 - $41,250 = $67,250
Contribution to overheads = $67,250
Contribution to overheads as a percentage to sales = Contribution to overheads / Sales
Contribution to overheads as a percentage to sales = ($67,250 / $2,82,000) = 23.85%
Contribution to overheads as a percentage to sales = 23.85%
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