Contribution Margin Ratio a. Young Company budgets sales of $770,000, fixed costs of $39,800, and variable costs of $177,100. What is the contribution margin ratio for Young Company? X% b. If the contribution margin ratio for Martinez Company is 63%, sales were $725,000, and fixed costs were $351,700, what was the operating income? Feedback Check My Work a. Sales minus variable costs equals contribution margin. Contribution margin divided by sales equals contribution margin ratio. b. Sales times contribution margin ratio equals contribution margin. Contribution margin minus fixed costs equals income from operations