Betsy loves to garden, and her rose garden is enjoyed by everyone in her neighborhood. Because her consumption of rosebushes pro
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Answer:
Contribution margin ratio = 1 - variable cost ratio
= 25%
(a)
= 1,400,000
= 25,000
(b) For profit of $42,000,
= 1,568,000
= 28,000
(c) variable cost = sales price × variable cost ratio
= $56 × 75%
= $42
New contribution margin =
New contribution margin =
= 0.4
= 40%
= $875,000
= 12,500