Grass Valley Mining mines three products.Gold ore sells for $1,000 per ton, variable costs are $400 per ton, and fixed mining costs are $250,000.Last year the segment margin was $(100,000). How many tons of gold ore did Grass Valley Mining sell last year?
A) 375 tons
B) 1,000 tons
C) 250 tons
D) 200 tons

Question

Quizplus · Accepted Answer

SUPPORTING CALCULATIONS:
Segment margin plus direct fixed costs equals contribution margin.
 
Therefore, $(100,000) + $250,000 = $150,000
 
$150,000 / $600 = 250 tons

Grass Valley Mining Mines Three Products