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17 March, 18:57

During its most recent fiscal year, Simon Enterprises sold 200,000 electric screwdrivers at a price of $15 each. Fixed costs amounted to $400,000 and pretax income was $600,000. What amount should have been reported as variable costs in the company's contribution margin income statement for the year in question?

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  1. 17 March, 21:48
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    Sales-VC=Contribution

    Contribution-FC=600000

    Contribution=1000000

    Sales-VC=1000000

    VC=200000*15-1000000

    VC=2000000

    d. $2,000,000.
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