Bumper Earned Net Income of $72,000 and Has Fixed Costs

question 7

Multiple Choice

Bumper earned net income of $72,000 and has fixed costs of $36,000.Bumper sold 11,000 units for $30 each and has a 40% contribution margin ratio.What were Bumper's operating income and tax rate?

• A)$96,000; 25%
• B)$120,000; 40%
• C)$270,000; 27%
• D)$162,000; 45%

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Definitions:

Bruise

A bruise is a discoloration of the skin resulting from trauma leading to broken blood vessels under the skin without breaking the skin surface.

Emergency Department

A specialized facility within a hospital where patients with acute illnesses or injuries are treated urgently.

Purple-Blue

A color descriptor that blends tones of purple and blue, often used to describe bruises or certain types of flowers.

Bruise

Discoloration of the skin caused by bleeding underneath, typically resulting from a bump or injury.