Janet Company produces a game that sells for $17 per game. Variable expenses are $9 per game, and fixed expenses total $172,000 annually.
-The contribution margin ratio is closest to which of the following?
A) 47.1%.
B) 2.1%.
C) 1.9%.
D) 52.9%.

Question

Quizplus · Accepted Answer

The contribution margin is the difference between the selling price and the variable expenses. In this case, the contribution margin is $17 - $9 = $8. The contribution margin ratio is the contribution margin divided by the selling price. In this case, the contribution margin ratio is $8 / $17 = 47.1%.

Janet Company Produces a Game That Sells for $17 Per