Which of the following formulas is used to calculate the contribution margin ratio?
A)(Sales - Fixed expenses)$\div$ Sales
B)(Sales - Cost of goods sold)$\div$ Sales
C)(Sales - Variable expenses)$\div$ Sales
D)(Sales - Total expenses)$\div$ Sales

Question

Which of the following formulas is used to calculate the contribution margin ratio?
A)(Sales - Fixed expenses)$\div$  Sales
B)(Sales - Cost of goods sold)$\div$  Sales
C)(Sales - Variable expenses)$\div$ Sales
D)(Sales - Total expenses)$\div$  Sales

Quizplus · Accepted Answer

The formula to calculate the contribution margin ratio is (Sales - Variable expenses) / Sales. Option C matches this formula and is therefore the correct choice. A, B, and D do not have the correct formula for calculating the contribution margin ratio.

Which of the Following Formulas Is Used to Calculate the Contribution