Answered: If the contribution margin ratio is 40%…

If the contribution margin ratio is 40% for Smithfield Enterprises, sales are $1,200,000, and fixed costs are $300,000, what is the operating profit?

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter3: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 14EB: Company A has current sales of $4,000,000 and a 45% contribution margin. Its fixed costs are...

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Question

I need guidance in solving this financial accounting problem using standard procedures.

If the contribution margin ratio is 40%
for Smithfield Enterprises, sales are
$1,200,000, and fixed costs are
$300,000, what is the operating profit?

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