The Gasson Company Sells Three Products, Product A, Product B

question 166

Multiple Choice

The Gasson Company sells three products, Product A, Product B and Product C, and had sales of $1,000,000 during the month of June. The company's overall contribution margin ratio was 37% and fixed expenses totaled $350,000. Sales were: Product A, $500,000; Product B, $300,000; and Product C, $200,000. Traceable fixed costs were: Product A, $120,000; Product B, $100,000; and Product C, $60,000. The variable expenses of Product A were $300,000 and the variable expenses of Product B were $180,000.
-The contribution margin ratio for Product C is:

• A)75%
• B)69%
• C)31%
• D)25%

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Definitions:

Community Shopping Center

A retail location that typically has one primary store (usually a department store branch) and often 20 to 40 smaller outlets, serving a population of consumers who are within a 10- to 20-minute drive.

Primary Store

The main retail outlet or location of a business that serves as the centerpiece for brand identity and customer engagement.

Department Store Branch

A subsidiary location of a larger department store company, offering a range of merchandise and services similar to the main store but located in different areas.

Population of Consumers

The total group of individuals who are potential or actual buyers of a product or service within a given market.