Sales Are $500000 and Variable Costs Are $330000

question 45

Multiple Choice

Sales are $500000 and variable costs are $330000. What is the contribution margin ratio?

• A) 52%
• B) 34%
• C) 66%
• D) Cannot be determined because amounts are not expressed per unit.

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Definitions:

Cash Investment

Funds that are invested in assets that can be quickly turned into cash, or the act of putting money into financial schemes, shares, property, or a commercial venture with the expectation of achieving a profit.

Equipment Sale

The process of selling off business-owned equipment, either to upgrade to newer assets or to liquidate assets for cash.

Cash Dividend

A payment made by a company out of its earnings to its shareholders in cash.

Financing Activities

Transactions that involve raising funds to finance the company's operations and repaying debt; part of a firm's financial operations detailed on the statement of cash flows.