Question

question 1- A cement manufacturer has supplied the following data:

Tons of cement produced and sold		315,000
Sales revenue	$	1,019,000
Variable manufacturing expense	$	240,000
Fixed manufacturing expense	$	337,000
Variable selling and administrative expense	$	167,600
Fixed selling and administrative expense	$	101,000
Net operating income	$	173,400

The company's contribution margin ratio is closest to:

question 2-

Kite Corporation has provided the following contribution format income statement. Assume that the following information is within the relevant range.

Sales (3,000 units)	$	180,000
Variable expenses		108,000
Contribution margin		72,000
Fixed expenses		62,400
Net operating income	$	9,600

The contribution margin ratio is closest to:

Answer 1

Answer:
1)
Particulars	Amount (in $
Sales revenue	$ 1,019,000
Less: Variable Expenses              ( $ 240,000 + $ 167,600 )	($ 407,600)
Contribution margin	$ 611,400
Contribution Margin ratio            = Contribution Margin / Sales            =    $ 611,400 / $ 1,019,000	60%
2)
Contribution Margin ratio            = Contribution Margin / Sales            =    $ 72,000 / $ 180,000	40%