Jamie Quinn, a sole proprietor, has the following projected figures for next year: $\begin{array} { l }
\text { Selling price per unit}&\$150.00\
\text { Contribution margin per unit}&\$45.00\
\text {Total fixed costs }&\$630,000\
\end{array}$

What is the contribution margin ratio?
A)0.300
B)1.429
C)0.429
D)3.333

Question

Jamie Quinn, a sole proprietor, has the following projected figures for next year: $\begin{array} { l  }
 \text { Selling price per unit}&\$150.00\
 \text { Contribution margin per unit}&\$45.00\
 \text {Total fixed costs }&\$630,000\
\end{array}$

What is the contribution margin ratio?
A)0.300
B)1.429
C)0.429
D)3.333

Quizplus · Accepted Answer

The contribution margin ratio is calculated as the contribution margin per unit divided by the selling price per unit. Thus, $ \frac{\$45.00}{\$150.00} = 0.300 $.

Jamie Quinn, a Sole Proprietor, Has the Following Projected Figures