Question

It costs​ Homer's Manufacturing $ 0.95$0.95 to produce baseballs and Homer sells them for $ 4$4 a piece. Homer pays a sales commission of​ 5% of sales revenue to his sales staff. Homer also pays $ 13 comma 000$13,000 a month rent for his factory and​ store, and also pays $ 78 comma 000$78,000 a month to his staff in addition to the commissions. Homer sold 70 comma 50070,500 baseballs in June. If Homer prepares a contribution margin income statement for the month of​ June, what would be his contribution​ margin?

Answer 1

42,72% is the margin

Step-by-step explanation:

Revenue (price * quantity sold) 282

Sales costs 70,5

EBITDA 211,5

Administrative costs 91

Profit 120,5 Margin 42,73%

You calculate the cost dividing Profit into revenue.