To calculate the total contribution margin, the formula is:

$\text{Contribution Margin} = \text{Sales Revenue} - \text{Variable Costs}$

From the given data:

• Sales Revenue = $420,695
• Variable Cost of Goods Sold (COGS) = $252,417

Contribution Margin Calculation:

$\text{Contribution Margin} = 420,695 - 252,417 = 168,278$

Thus, the correct answer is:

$168,278

Do you have further questions or need additional clarifications?

Here are 5 related questions you might want to explore:

1. What is the contribution margin per unit, and how is it calculated?
2. How does the fixed cost affect the break-even point for this company?
3. What is the contribution margin ratio, and how can it guide pricing decisions?
4. How is depreciation treated in contribution margin analysis?
5. What insights can be drawn by comparing gross margin and contribution margin?

Tip: The contribution margin is key to understanding profitability and cost structure. Use it to evaluate whether sales cover variable costs effectively.