Question: A computer hardware distributor, Modem, has three branches in Cardiff, Edinburgh and London. It has the following financial details. Head office fixed overheads are 150,000.

A computer hardware distributor, Modem, has three branches in Cardiff, Edinburgh and London. It has the following financial details.

Revenue Direct Labour Other Variable Overheads Cardiff 200,000 60,000 105,000 Edinburgh 300,000Head office fixed overheads are £150,000.

Required:

(i) Calculate the contribution/revenue ratios.

(ii) Draw the contribution graph.

Revenue Direct Labour Other Variable Overheads Cardiff 200,000 60,000 105,000 Edinburgh 300,000 80,000 150,000 London 1,000,000 350,000 520,000

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