Liu Sales Has Two Store Locations

question 123

Multiple Choice

Liu Sales has two store locations. Sanford has fixed costs of $250,000 per month and a contribution margin ratio of 35%. Orlando has fixed costs of $400,000 per month and a contribution margin ratio of 65%. At what sales volume would the two stores have equal profits or losses?

• A) $500,000.
• B) $650,000.
• C) $1,300,000.
• D) Cannot determine with the information given.

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