Final answer:
The best estimate of the total contribution margin when 15,330 units are sold is approximately $1,092,267.80.
Step-by-step explanation:
The contribution margin is calculated as the selling price per unit minus the variable cost per unit. Variable cost per unit is calculated as the cost of sales per unit.
First, let's calculate the contribution margin per unit:
Contribution Margin per Unit = Selling Price per Unit - Variable Cost per Unit
Variable Cost per Unit = Cost of Sales / Sales Volume
For the sales volume of 14,500 units:
Variable Cost per Unit = $1,102,000 / 14,500
For the sales volume of 15,790 units:
Variable Cost per Unit = $1,200,040 / 15,790
Now, calculate the contribution margin per unit:
Contribution Margin per Unit = $147.00 - Variable Cost per Unit
Next, find the total contribution margin when 15,330 units are sold:
Total Contribution Margin = Contribution Margin per Unit x Sales Volume at 15,330 units
Let's do the calculations:
For 14,500 units:
Variable Cost per Unit = $1,102,000 / 14,500 ≈ $76.00
Contribution Margin per Unit = $147.00 - $76.00 = $71.00
Total Contribution Margin at 15,330 units} = $71.00 x 15,330 ≈ $1,089,630
For 15,790 units:
Variable Cost per Unit = $1,200,040 / 15,790 ≈$75.84
Contribution Margin per Unit = $147.00 - $75.84 = $71.16
Total Contribution Margin at 15,330 units = $71.16 x 15,330 ≈ $1,092,267.80
So, the best estimate of the total contribution margin when 15,330 units are sold is approximately $1,092,267.80.
None of the provided options match exactly, but the closest one is $720,510, though it is not the correct answer based on the calculations. There might be a discrepancy in the provided answer choices.