Pepper’s Automotive produces auto parts for various automotive retailers. Pepper’s is evaluating the exhaust system division of the company and has come up with the following data for the year: net revenues are $1,270,000, variable costs are $426,000, and fixed costs are $517,000. Of the fixed costs, controllable fixed costs are $118,000 and noncontrollable fixed costs are $399,000.   What are the controllable margin and total contribution by profit center (CPC), respectively?

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Pepper’s Automotive produces auto parts for various automotive retailers. Pepper’s is evaluating the exhaust system division of the company and has come up with the following data for the year: net revenues are $1,270,000, variable costs are $426,000, and fixed costs are $517,000. Of the fixed costs, controllable fixed costs are $118,000 and noncontrollable fixed costs are $399,000.

 

What are the controllable margin and total contribution by profit center (CPC), respectively?

 

multiple choice

  • Controllable margin: $726,000; CPC: $445,000
  • Controllable margin: $844,000; CPC: $327,000
  • Controllable margin: $844,000; CPC: $118,000
  • Controllable margin: $726,000; CPC: $327,000

 

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