Goldberg Industries reported the following information about the production and sale of its only product during the first month of operations: Under variable costing,the contribution margin is ________.
A)$7,000
B)$21,000
C)$33,000
D)$34,500

Question

Goldberg Industries reported the following information about the production and sale of its only product during the first month of operations:  Under variable costing,the contribution margin is ________.
A)$7,000 
B)$21,000 
C)$33,000 
D)$34,500

Quizplus · Accepted Answer

Under variable costing, the contribution margin can be calculated by subtracting variable expenses from revenues. In this case, variable expenses include direct materials, direct labor, and variable overhead.

Contribution margin = Revenues - Variable expenses
Contribution margin = $43,500 - ($6,000 + $12,000 + $13,500)
Contribution margin = $43,500 - $31,500
Contribution margin = $12,000

Therefore, the correct answer is choice C, $33,000.

Goldberg Industries Reported the Following Information About the Production and Sale