Business, 1,000 units; Math, 500 units

Mark Corporation produces two models of calculators. The Business model sells for $60, and

the Math model sells for $40. The variable expenses are given below:

 

Business

Math

 

Model

Model

Variable production costs per unit

$15

$16

Variable selling and administrative expenses per unit

$9

$6

The fixed expenses are $75,000 per month. The expected monthly sales of each model are:

Business, 1,000 units; Math, 500 units.

The contribution margin ratio for the Business model is:

A) 40 percent

B) 75 percent

C) 85 percent

D) 60 percent