Dakota Company Provides the Following Information About Its Single Product

question 52

Multiple Choice

Dakota Company provides the following information about its single product:
$$\begin{array} {| l | r | } \hline \text { Targeted aperating income } & \$ 40,000 \\\hline \text { Selling price per unit } & \$ 3.50 \\\hline \text { Variable cost per unit } & \$ 1.05 \\\hline \text { Total fixed costs } & \$ 90,000 \\\hline\end{array}$$
What is the contribution margin ratio?

• A) 0.70
• B) 0.44
• C) 0.56
• D) 0.30

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Definitions:

Amylase

An enzyme, found chiefly in saliva and pancreatic fluid, that converts starch and glycogen into simple sugars.

Elastase

An enzyme that breaks down elastin, an important protein in connective tissue which provides elasticity.

Enzymatic Reaction

A chemical process catalyzed by enzymes, speeding up reactions in the cells.

Reactants

Reactants are substances initially present in a chemical reaction that are consumed during the reaction to form products.