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.The segment margin for 2011 was $(100,000). What were the sales (in tons)for 2011?
A)375 tons
B)1,000 tons
C)250 tons
D)200 tons

Question

Quizplus · Accepted Answer

Segment Margin = (Sales - Variable Costs) - Fixed Costs$100,000 = (Sales - $400 per ton) - $250,000Sales = $400 per ton + $100,000 + $250,000Sales = $750,000Sales (in tons) = $750,000 / $1,000 per tonSales (in tons) = 375 tons

Grass Valley Mining Mines Three Products