Question
In: Accounting
1. Ivanhoe Bucket Co., a manufacturer of rain barrels, had the following data for 2019. Sales...
1. Ivanhoe Bucket Co., a manufacturer of rain barrels, had the
following data for 2019.
| Sales | 2,260 | units | |
| Sales price | $45 | per unit | |
| Variable costs | $27 | per unit | |
| Fixed costs | $20,340 |
What is the contribution margin ratio? work out problem step by step. (write what to do step by step and why)
Solutions
Expert Solution
Answer :- 40%
| Particulars | A. Units | B. unit price | C.Amount (A*B) | |
| A. | Sales | 2,260 | $45 | $101,700 |
| B. | Varible cost | 2,260 | $27 | $61,020 |
| C. | Contribution ( A-B) | $40,680 |
| Contribution margin ratio = (Contribution/ sales) * 100 | ||
| = ( $40.680 / $101,700) *100 | ||
| = 40% |
ekkarill92 answered 2 years agoRelated Solutions
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