21. Variable costs are $400,000 and the contribution margin (CM) ratio is 0.20 (20%). If target profit (net income) is $50,000, how much are fixed costs? a $75,000 b. $50,000 c. $350,000 d. $2,000,000 22. Contribution margin is the amount of sales revenue remaining after deducting a. mixed costs. b. fixed costs c. variable costs. d. factory overhead costs. 23. At Harry's Company, maintenance costs are a mixed cost. At the low level of activity (200 direct labor hours), maintenance costs are $1,000. At the high level of activity (1,000 direct labor hours), maintenance costs are $2,600. Using the high-low method, what is the variable maintenance cost per direct labor hour? a. 53.00 b. 58.00 c. $1.60 d. $2.00 24. Lagarde, Inc. has a margin of safety 24% (0.24) of actual sales revenue, and total fixed costs $750,000. Lagarde's contribution margin (CM) ratio is 0.40 (40%). What is the amount of total actual Sales Revenue (rounded to the nearest Sl)? a $7,812,500 b. S1,875,000 c. $1,953,125 d. $2,467,105 25. The amount of actual or expected sales revenue decline that may occur before an operating loss happens is referred to as a. contribution margin (CM) ratio. b. margin of safety. c. total costs (fixed + variable costs). d. budgeted net income. 26. When a company's contribution margin is more than its fixed costs the company's sales revenue is a. less than its total (fixed plus variable) costs. b. greater than its total (fixed plus variable) costs. c. less than its net income. d. less than its contribution margin