Decko Industries Reported the Following Monthly Data What Is the Company's Contribution Margin for This Month If

question 88

Multiple Choice

Decko Industries reported the following monthly data: $\begin{array}{ll}\text { Units produced } & 52,000 \text { units } \\\text { Sales price } & \$ 33 \text { per unit } \\\text { Direct materials } & \$ 1.50 \text { per unit } \\\text { Direct labor } & \$ 2.50 \text { per unit } \\\text { Variable overhead } & \$ 3.50 \text { per unit } \\\text { Fixed overhead } & \$ 234,000 \text { in total }\end{array}$ What is the company's contribution margin for this month if 50,000 units were sold?

• A)$1,326,000
• B)$1,716,000
• C)$1,275,000
• D)$1,650,000
• E)$1,450,000

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Definitions:

Deferred Tax Liability

A tax obligation due in the future for income that has been recognized in the financial statements before it is taxable.

Inventory

The raw materials, work-in-process products, and finished goods that are considered to be the portion of a business's assets that are ready or will be ready for sale.

Accounts Payable

Liabilities of a business representing amounts owed to creditors for goods and services received but not yet paid for.

Noncash Transactions

Financial activities that do not involve the transfer of cash, including depreciation, stock-based compensation, and asset exchanges, but impact the financial statements.