If the Contribution Margin Ratio Is 0

question 87

Multiple Choice

If the contribution margin ratio is 0.60, targeted operating income is $95,000, and targeted sales volume in dollars is $530,000, then the degree of operating leverage is ________.

• A) 0.30 times
• B) 0.67 times
• C) 3.35 times
• D) 2.23 times

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Definitions:

Euro

The official currency of the Eurozone, which is used by most European Union countries and is one of the world's major currencies.

Exchange Rate

The worth of one currency relative to another, used to determine the amount of one currency that can be swapped for a different one.

Japanese Yen

The official currency of Japan, often symbolized as ¥ and known for being one of the most traded currencies in the foreign exchange market.

U.S. Dollar

The official currency of the United States, widely used as a standard currency in international markets.