Sales Are $60,000 and Variable Costs Are $45,000

question 94

Multiple Choice

Sales are $60,000 and variable costs are $45,000.How much is the contribution margin ratio?

• A)75%
• B)50%
• C)25%
• D)Cannot be determined without more information.

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Definitions:

Service Contract

A formal agreement between a service provider and a client, detailing the terms of service to be rendered.

Performance Obligations

A term in revenue recognition denoting promises to transfer goods or services to a customer as part of a contract.

Cash Receipts

The total amount of money, including cash, checks, and electronic transfers, received by a business during a given period.

Accounting Records

Documentation and books that maintain a systematic record of financial transactions and positions of a business.