Answer:
47%
Explanation:
Lee industry have a sale of $525,000
Variable cost is 53% of sales
= 53/100 × $525,000
= 0.53×$525,000
= $278,250
The operating income is $19,000
The first step is to calculate the contribution margin
Contribution margin= sales-variable cost
= $525,000-$278,250
= $246,750
Therefore the contribution margin ratio can be calculated as follows
= contribution margin/sales
= $246,750/$525,000
= 0.47 × 100
= 47%
Hence the contribution margin ratio is 47%
