Question
Bunny Corporation has two divisions: Outdoor Sports and Indoor Sports. The sales mix is 60% for Outdoor Sports and 40% for Indoor Sports. Green incurs
Bunny Corporation has two divisions: Outdoor Sports and Indoor Sports. The sales mix is 60% for Outdoor Sports and 40% for Indoor Sports. Green incurs $2,420,000 in fixed costs. The contribution margin ratio for the Outdoor Sports Division is 40%, while the Indoor Sports Division has a 50% contribution margin ratio.
The weighted- average contribution margin ratio is 44%.
Explain how they arrived at an answer of 44%?
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Financial And Managerial Accounting The Basis For Business Decisions
Authors: Jan Williams, Susan Haka, Mark Bettner, Joseph Carcello
19th Edition
1260247937, 978-1260247930
