Capity Tea Products has an exclusive contract with British Distributors. Calamine and Capity are two brands of teas that are imported and sold to retail outlets. The following information is provided for the month of March:

Budgeted and actual fixed corporate-sustaining costs are $1,850 and $2,300, respectively. What is the contribution margin for the flexible budget?
A) $8961
B) $9855
C) $9266
D) $10,811

Question

Capity Tea Products has an exclusive contract with British Distributors. Calamine and Capity are two brands of teas that are imported and sold to retail outlets. The following information is provided for the month of March:

Budgeted and actual fixed corporate-sustaining costs are $1,850 and $2,300, respectively. What is the contribution margin for the flexible budget?
A) $8961 
B) $9855 
C) $9266 
D) $10,811

Quizplus · Accepted Answer

Contribution margin for the flexible budget = (3870 × $1) + (3990 × $1.50) = $9855

Capity Tea Products Has an Exclusive Contract with British Distributors