Question

Calip Corporation, a merchandising company, reported the following results for October: Sales $427,000 Cost of goods sold (all variable) $173,400 Total variable selling expense $21,200 Total fixed selling expense $18,900 Total variable administrative expense $9,600 Total fixed administrative expense $36,300 The contribution margin for October is:

Answer 1

Answer: $222,800

Explanation:

Given that,

Sales = $427,000

Cost of goods sold (all variable) = $173,400

Total variable selling expense = $21,200

Total fixed selling expense = $18,900

Total variable administrative expense = $9,600

Total fixed administrative expense = $36,300

Variable expenses:

= Cost of goods sold + Variable selling expense + Variable administrative expense

= $173,400 + $21,200 + $9,600

= $204,200

Contribution margin = Sales - Variable expenses

                                  = $427,000 - $204,200  

                                 = $222,800