During March, a firm expects its total sales to be $160,000, its total variable costs to be $95,000, and its total fixed costs to be $25,000. The contribution margin for March is:

Question

Quizplus · Accepted Answer

Contribution margin is the amount of sales revenue remaining after variable costs have been deducted.

Contribution Margin = Total Sales - Total Variable Costs

Substituting the given values:

Contribution Margin = $160,000 - $95,000

Contribution Margin = $65,000

Therefore, the contribution margin for March is $65,000.

During March, a Firm Expects Its Total Sales to Be