Exercise 3-13 (Part Level Submission) Sheridan Monograms sells stadium blankets

Question

Exercise 3-13 (Part Level Submission) Sheridan Monograms sells stadium blankets that have been monogrammed with high school and university emblems. The blankets retail for $46 throughout the country to loyal alumni of over 3,800 schools. Sheridan's variable costs are 42% of sales; fixed costs are $116,000 per month. (a1) Calculate contribution margin ratio. (Round ratio to 2 percentage places, e.g. 0.38 = 38%.) Contribution margin ratio LINK TO TEXT LINK TO VIDEOLINK TO VIDEO Attempts: 0 of 15 used SAVE FOR LATER SUBMIT ANSWER

Explanation / Answer

A)

We All Know

That Sales - Variable costs = contribution margin

Given variable costs are 42 % of sales

Let sales be 100

then variable costs are $42

Contribution=$100-$42=$58

So your contribution margin % will be =contribution/sales=$58/100=58%

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