The Following Information Pertains to the Northwest Territory of Burger

question 148

Multiple Choice

The following information pertains to the Northwest Territory of Burger King Company: $\begin{array}{lr}\text { Net Sales } & \$ 6,000 \\\text { Variable costs: } & \\\text { Cost of merchandise sold } & 1,200 \\\text { Operating expenses } & 450 \\\text { Fixed costs: } & \\\text { Controllable by segment manager } & 1,600 \\\text { Controllable by others } & 1,250 \\\text { Unallocated costs } & 750\end{array}$ The contribution margin is _____.

• A)$2,750
• B)$3,650
• C)$4,350
• D)$2,500

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Definitions:

Factory Overhead Cost

Indirect costs associated with manufacturing that are not directly tied to a specific product, such as utilities, maintenance, and factory equipment depreciation.

Direct Materials Cost

The expense incurred for raw materials that are directly incorporated into a finished product during the manufacturing process.

Direct Labor Cost

The total cost of labor directly involved in the production of goods or services.

Dividends

Payments made by a corporation to its shareholder members, usually derived from the company's profits.