The contribution margin ratio is 25% for Grain Company and the break-even point in sales is $200,000. To obtain a target net operating income of $60,000, sales would have to be:. A. $260,000.
B. $440,000.
C. $280,000.
D. $240,000.

Option B. 440000

Explanation:

Given the contribution margin = 25%

Sales at break-even point = $200000

Net operating income = $60000

Sales at break even point = TFC / contribution margin ratio

200000 = TFC / 25%

TFC = 50000

Now find the net income:

Net income = Contribution margin - Fixed cost

60000 = Contribution margin - 50000

Contribution margin =60000 + 50000 = 110000

Sales revenue = Contribution margin / contribution ratio

Sales revenue = 110000 / 0.25 = 440000

the correct answer is economics is a game without winners or losers.

unlike sports or games economic is a game without losers or winner rather it is a game where everyone wins. parties of business doing businesses exchange money with each other and hence exchange is done on the basis of goods. one party takes the goods and other sales it so there is winner on both sides. each party values more highly the good it gets than the good it gives up. both sides exchange only because both intend to increase their value. so there is no concept of lose or win.