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Goria Corporation: Total Contribution Margin

Goria Corporation is a wholesaler that sells a single product. Management has provided the following cost data for two levels of monthly sales volume. The company sells the product for $133.60 per unit.

Sales volume(units) 4,000 5,000
Cost of sales $383,600 $479,500
Selling of administrative costs $124,000 $136,000

The best estimate of the total contribution margin when 4,300 units are sold is:

A) $112,230
B) $162,110
C) $28,380
D) $45,150

Solution Preview

First we calculate the percentage of contribution margin for the two sales levels given in the ...

Solution Summary

The solution shows all the calculations for two expected levels of unit sales in explanation of the answer, which is given.