Ultimo Co. operates three production departments as profit centers. The following information is available for its most recent year. Department 2's contribution to overhead in dollars is:
A) $210,000.
B) $350,000.
C) $10,000.
D) $260,000.
E) $150,000.

Question

Ultimo Co. operates three production departments as profit centers. The following information is available for its most recent year. Department 2's contribution to overhead in dollars is: 
A) $210,000. 
B) $350,000. 
C) $10,000. 
D) $260,000. 
E) $150,000.

Quizplus · Accepted Answer

Sales − Cost of goods sold − Direct expenses = Contribution to overhead
$400,000 − $150,000 − $40,000 = $210,000

Ultimo Co Operates Three Production Departments as Profit Centers