My Learning Cart
?
Categories
Account

In a case study, a company has total sales of $50,000 and total variable costs o

₹0.0
Login to Download
  • 📥 Instant PDF Download
  • ♾ Lifetime Access
  • 🛡 Secure & Original Content

What’s inside this PDF?

Question: In a case study, a company has total sales of $50,000 and total variable costs of $30,000. What is the contribution margin?

Options:

  1. $20,000
  2. $30,000
  3. $50,000
  4. $10,000

Correct Answer: $20,000

Solution: 

Contribution margin is calculated as Sales Revenue ($50,000) minus Variable Costs ($30,000), which equals $20,000.

In a case study, a company has total sales of $50,000 and total variable costs o

Practice Questions

Q1
In a case study, a company has total sales of $50,000 and total variable costs of $30,000. What is the contribution margin?
  1. $20,000
  2. $30,000
  3. $50,000
  4. $10,000

Questions & Step-by-Step Solutions

In a case study, a company has total sales of $50,000 and total variable costs of $30,000. What is the contribution margin?
  • Step 1: Identify the total sales amount, which is $50,000.
  • Step 2: Identify the total variable costs, which is $30,000.
  • Step 3: Use the formula for contribution margin: Contribution Margin = Total Sales - Total Variable Costs.
  • Step 4: Substitute the values into the formula: Contribution Margin = $50,000 - $30,000.
  • Step 5: Calculate the result: $50,000 - $30,000 = $20,000.
  • Step 6: The contribution margin is $20,000.
  • Contribution Margin – The contribution margin is the difference between total sales and total variable costs, indicating how much revenue is available to cover fixed costs and contribute to profit.
Soulshift Feedback ×

On a scale of 0–10, how likely are you to recommend The Soulshift Academy?

Not likely Very likely
Home Practice Performance eBooks