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21 November, 17:38

If sales are $820,000, variable costs are 55% of sales, and operating income is $260,000, what is the contribution margin ratio? correct answer 45% you answered

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  1. 21 November, 18:03
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    Contribution Margin Ratio = Contribution Margin / Sales

    Contribution Margin = Sales - Variable Cost

    CM=820,000-820,000*0.55

    CM=369,000

    Contribution Margin Ratio

    369,000:820,000=0.45

    0.45*100

    =45%
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