If Sales Are $425,000, Variable Costs Are 62% of Sales

question 123

Multiple Choice

If sales are $425,000, variable costs are 62% of sales, and operating income is $50,000, what is the contribution margin ratio?

• A) 38%
• B) 26.8%
• C) 11.8%
• D) 62%

---

Definitions:

Meanwhile

Used to denote an event or situation that occurs simultaneously with another.

Illustration

An illustration is a visual representation designed to explain, clarify, or adorn textual information, helping to communicate ideas more effectively.

Paragraph Development

The expansion of an idea or argument within a paragraph through the use of evidence, examples, and explanations.

Topic Sentence

A sentence that summarizes the main idea of a paragraph or section, often found at the beginning to guide readers.