Answer the following questions using the information below:
Nancy's Niche sells a single product. 8,000 units were sold resulting in $80,000 of sales revenue, $20,000 of variable costs, and $10,000 of fixed costs.
-The contribution margin percentage is:
A)12.5%
B)25.0%
C)37.5%
D)75.0%

Question

Quizplus · Accepted Answer

The contribution margin is calculated as (Sales Revenue - Variable Costs) / Sales Revenue. Here, it is ($80,000 - $20,000) / $80,000 = $60,000 / $80,000 = 0.75 or 75%.

Answer the Following Questions Using the Information Below