Accounting 9706 · AS & A Level · Costs and cost behaviour

Costs and cost behaviour — practice question

A business recorded a contribution to sales ratio of 40%. The information below is given. sales revenue amounts to $10000 fixed costs amount to $3000 profit amounts to $100 It is forecast that sales revenue will rise by 20% next year. Total fixed costs will stay unchanged. By how much will profit increase?

  • A$8000
  • B$180
  • C$380
  • D$480

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