McKay Corporation has Sales of $147,500,Cost of Goods Sold of $70,200,Direct Expenses of $35,300,and Indirect Expenses of $30,000.What is McKay Corporation's Contribution Margin?

Question

Quizplus · Accepted Answer

Contribution Margin = Sales - Variable Costs
Variable Costs = Cost of Goods Sold + Direct Expenses
Variable Costs = $70,200 + $35,300 = $105,500
Contribution Margin = $147,500 - $105,500 = $42,000. Therefore, the correct answer is C.

McKay Corporation Has Sales of $147,500,Cost of Goods Sold of $70,200,Direct