Question

On average, a book sells for $70. Variable selling expenses are $5 per book with the remaining selling expenses being fixed. The variable administrative expenses are 3% of sales with the remainder being fixed. The contribution margin for Iyekqv603 Corp. for the first quarter is:

Answer 1

The contribution margin for Iyekqv603 Corp. is calculated by subtracting total variable costs from the sales price per book, which includes variable selling and administrative expenses. The contribution margin per book is $62.90.

Step-by-step explanation:

To calculate the contribution margin for Iyekqv603 Corp., we need to subtract the variable costs from the sales price per book. The average sales price is given as $70 per book, variable selling expenses are $5 per book, and variable administrative expenses are 3% of sales. Thus, variable administrative expenses amount to $70 * 3/100 = $2.10 per book.

Now, we can calculate the contribution margin per book as follows:

Sales Price per book = $70

Variable Selling Expenses per book = $5

Variable Administrative Expenses per book = $70 * 3% = $2.10

Total Variable Costs per book = $5 + $2.10 = $7.10

Contribution Margin per book = Sales Price per book - Total Variable Costs per book = $70 - $7.10 = $62.90

The contribution margin represents the portion of sales revenue that is not consumed by variable costs and contributes to covering fixed costs.

Answer 2

$287,700

Step-by-step explanation:

• Please note that this is an incomplete question. However, the needed parts were gotten from the internet.

Sales = $910,000

Cost of goods sold = $530,000

Contribution margin = sales - cost of goods sold - variable selling expenses - variable administrative expenses

Number of books sold = Sales reported / Average selling price per book

= $910,000 / $70

= 13,000 books

Total variable selling expenses = Number of books sold × selling expenses per unit

= 13,000 × $5

= $65,000

Total variable administrative expenses = reported sales × variable adm. as a % of sales

= $910,000 × 3%

= $27,300

Contribution margin = $910,000 - $530,000 - $65,000 - $27,300

= $287,700