Management predicts total sales for June to be $3,000,000, yielding a margin of safety of $1,000,000 and a contribution margin ratio of 25%. Which of the following amounts is not consistent with this information?

Question

Quizplus · Accepted Answer

The variable costs cannot be $750,000 because with a contribution margin ratio of 25%, the variable costs should be 75% of sales, which would be $2,250,000 for $3,000,000 in sales.

Management Predicts Total Sales for June to Be $3,000,000, Yielding