Use the Following Information to Answer Questions

Multiple Choice

Use the following information to answer questions
Reliable Furniture manufactures recliners selling for $500 each. Variable costs per unit are $175 for direct material, $125 for direct labor, $35 for variable production overhead, and $15 for variable selling and administrative costs. Annual fixed costs are $200,000 for production overhead and $100,000 for selling and administrative costs. The company applies fixed production overhead to recliners based on a capacity of 20,000 units per year.
-Reliable Furniture's contribution margin ratio is

A) 28%.
B) 30%.
C) 33%.
D) 40%.
E) 53%.