Wendell's Bicycles Store Buys Bicycles on Average for $500 and Sells

question 259

Multiple Choice

Wendell's Bicycles store buys bicycles on average for $500 and sells them on average for $800. He pays a sales commission of 10% of sales revenue to his sales staff. Wendell pays $1,500 a month rent for his store, and also pays $3,000 a month to his staff in addition to the commissions. Wendell sold 100 bicycles in June.
-If Wendell prepares a contribution margin income statement for the month of June, what would be his contribution margin?

• A) $80,000
• B) $22,000
• C) $138,000
• D) $58,000

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