Chang Corporation Has Two Divisions, T and W

question 322

Multiple Choice

Chang Corporation has two divisions, T and W. The company's overall contribution margin ratio is 40%, with sales in the two divisions totaling $900,000. If variable expenses are $200,000 in Division T and if Division W's contribution margin ratio is 20%, the sales in Division W must be:

• A) $200,000
• B) $425,000
• C) $700,000
• D) $340,000

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Definitions:

Labor Market

The labor market is an economic market in which workers seek employment and employers seek to hire workers, often influenced by factors like wages, demand, and qualifications.

Marginal Tax Rate

The rate at which the next dollar of taxable income is taxed, reflecting the incremental increase in tax paid on an additional dollar of income.

Average Tax Rate

The ratio of the total amount of taxes paid to the total taxable income, representing the percentage of income paid in taxes.

Proportional Tax

A tax system where the rate of taxation is the same for all taxpayers, regardless of income or wealth.