The Monterra Company provided the following information:
Sales $500,000
Variable costs $100,000
Fixed costs $200,000
A. Calculate the contribution margin ratio.
B. Calculate the level of sales in dollars necessary to generate a profit of $40,000?.
C. Calculate the contribution margin ratio if the sales sales price is increased by 10%.
D. Using the information in part C, calculate the level of sales in dollars is necessary to generate a profit of $40,000.

Question

Quizplus · Accepted Answer

The Answer of The Monterra Company provided the following information:
Sales $500,000
Variable costs $100,000
Fixed costs $200,000
A. Calculate the contribution margin ratio.
B. Calculate the level of sales in dollars necessary to generate a profit of $40,000?.
C. Calculate the contribution margin ratio if the sales sales price is increased by 10%.
D. Using the information in part C, calculate the level of sales in dollars is necessary to generate a profit of $40,000.

The Monterra Company Provided the Following Information