Markham Company Has a Contribution Margin Ratio of 25

question 21

Multiple Choice

Markham Company has a contribution margin ratio of 25%.The company is considering a proposal that will increase sales by $150,000.What increase in profit can be expected assuming total fixed costs increase by $25,000? (Do not round intermediate calculations.)

• A) $6,250
• B) $31,250
• C) $37,500
• D) $12,500

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