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    Contribution Margin of G+ Company

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    G+ Company is a division of GHI Company. This data pertains to G+ division. Sales amounted to $800,000. Cost of sales is 60% of sales. Other direct expenses of the division amount to 15% of sales. Allocated expenses are $90,000. Interest amounts to 10% of long-term debt. Taxes are 30% of income. Total assets are $500,000 wtih 10% representing short-term and 40% representing long-term debt.

    The division's contribution margin amounts to:
    a) $320,000
    b) $380,000
    c) $420,000
    d) $480,000
    e) None of the above

    © BrainMass Inc. brainmass.com June 3, 2020, 9:17 pm ad1c9bdddf
    https://brainmass.com/business/accounting/174710

    Solution Summary

    This brief solution calculates the division contribution margin using the sales and share of costs.

    $2.19

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