The Following Information Is Available for Paperback Books Inc Division $\begin{array} { l } \text {net sales }&\$100,000&\$60,000&\$40,000 \\\end{array}$

The following information is available for Paperback Books Inc.and its two divisions,Books and Periodicals:
$$\begin{array} { l l l } \text { Whole } & \text { Eooks } & \text { Periodicals } \\\text { Company } & \text { Division } & \text { Division }\end{array}$$
Division
$\begin{array} { l } \text {net sales }&\$100,000&\$60,000&\$40,000 \\\end{array}$

Fixed Costs Controllable
$\begin{array} { l } \text {By Division Manager }&26,50&22,500&4,000\\\end{array}$

Fixed Costs Not Controlled
$\begin{array} { l } \text {By Division Manager }&18,000&15,000&3,000\\\end{array}$

Variable Costs:
$$\begin{array} { l l l l } \text { Cost of Merchandise Sold } & 24,500 & 17,500 & 7,000 \\\text { Operating Expenses } & 26,400 & 20,000 & 6,400 \\\text { Unallocated Costs } & 7,000 & &\end{array}$$
What is the contribution margin for the Books Division?

A) $15,000
B) $22,500
C) $32,500
D) $42,500

Correct Answer:

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