Dartmount Corporation Has Provided Its Contribution Format Income Statement for June.The

question 8

Multiple Choice

Dartmount Corporation has provided its contribution format income statement for June.The company produces and sells a single product.
$$\begin{array} { | l | r | } \hline \text { Sales } ( 2,900 \text { units) } & \$ 269,700 \\\hline \text { Variable costs } & 107,300 \\\hline \text { Contribution margin } & 162,400 \\\hline \text { Fixed costs } & 137,100 \\\hline \text { Operating protit } & \$ 25,300 \\\hline\end{array}$$
If the company sells 3,100 units,its total contribution margin should be closest to:

• A) $27,045.
• B) $181,000.
• C) $162,400.
• D) $173,600.

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Definitions:

NPV

Net present value, a calculation that reflects the present value of future cash flows minus initial investments, used to assess the profitability of a project.

Real Option

An approach in financial management that values investment options as if they were financial options, focusing on the flexibility of managerial decisions in response to market changes.

IRR

Stands for Internal Rate of Return, a financial metric used to estimate the profitability of potential investments.

Variance

A statistical measure that indicates the spread of data points in a dataset around the mean, reflecting the data's volatility.