Answer:
12%
Explanation:
Contribution margin ratio is calculated as
= Contribution margin / Sales
Sales [ $12 each × 1,000 drives sold] $12,000
Less Variable costs [$9 each x 1,000 drives sold]
($9,000)
Contribution margin
$3,000
Less Fixed costs
($1,000)
Operating profit
$1,000
Recall that contribution margin ratio
= [ Contribution margin / Sales] × 100
= [ $3,000 / $12,000 ] × 100
= 12%
Therefore, contribution margin ratio is 12%
