4

Colin was a professional classical guitarist until a motorcycle accident left him disabled. After long months of therapy, he hired an experienced luthier and started a small shop to make and sell Spanish guitars. The guitars sell for $600, and the fixed monthly operating costs are as follows: Colin's accountant told him about contribution margin ratios, and Colin understood clearly that for every dollar of sales, $0.70 went to cover his fixed costs, and anything above that point was profit. A. $4, 572 B. $5, 256 C. $12, 264 D. $4, 113