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    Contribution margin ratio

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    Devlin Company has two divisions, C and D. The overall company contribution margin ration is 30% with sales in the two divisions totaling $500,000. If variable expenses are $300,000 in Division C, and if Division C's contribution margin ratio is 25%, then sales in Division D must be?

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    Sales in Division D must be 35% to make overall contribution margin ratio of 30%

    30%=(x+25%)/2
    x=35%

    Note:
    *** Remember, this ...

    Solution Summary

    This provides the steps to calculate the Contribution margin ratio

    $2.19

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