Answer:
$60,000
Explanation:
Both sales and variable cost are dependent on the number of units sold.
The sales less the variable cost gives the contribution margin. The contribution margin less the fixed cost gives the net operating income.
The contribution margin ratio is the ratio of contribution margin to sales.
For Division B,
Contribution margin = 40% * $300,000
= $120,000
Total contribution margin (from the two divisions)
= $60000 + $120000
= $180,000
Total fixed expenses = $180,000 - $40,000
= $140,000
Common fixed expenses = $140,000 - $80,000
= $60,000
