It costs Homer's Manufacturing $0.85 to produce baseballs and Homer sells them for $4.00 a piece. Homer pays a sales commission of 5% of sales revenue to his sales staff. Homer also pays $13,000 a month rent for his factory and store, and also pays $81,000 a month to his staff in addition to the commissions. Homer sold 68,500 baseballs in June. If Homer prepares a contribution margin income statement for the month of June, what would be his contribution margin?

Question

Quizplus · Accepted Answer

The Answer of It costs Homer's Manufacturing $0.85 to produce baseballs and Homer sells them for $4.00 a piece. Homer pays a sales commission of 5% of sales revenue to his sales staff. Homer also pays $13,000 a month rent for his factory and store, and also pays $81,000 a month to his staff in addition to the commissions. Homer sold 68,500 baseballs in June. If Homer prepares a contribution margin income statement for the month of June, what would be his contribution margin?

It Costs Homer's Manufacturing $0