Contribution to Sales Ratio Calculation Steps:

• Identify sales revenue as $600,000 and assume total costs of$200,000 are variable costs, given production equals sales (no inventory change).
• Calculate total contribution margin: $600,000 -$200,000 = $400,000.
• Divide contribution by sales: $400,000 /$600,000 = 0.6667.
• Convert to percentage and round: 66.67% ≈ 67%.

Why C is correct:

• Contribution to sales ratio is defined as (sales revenue - variable costs) / sales revenue × 100%, which equals 67% using the given data.

Why the others are wrong:

• A: Equals variable cost ratio (200,000 / 600,000 ≈ 33%), not contribution.
• B: Matches variable cost percentage exactly (200,000 / 600,000 = 33%).
• D: Would require contribution of $480,000 (e.g., if costs were$120,000), but costs are $200,000.

Final answer: C