Question

EB4.

LO 3.1A product has a sales price of $90 and a per-unit contribution margin of $30. What is the contribution margin ratio?

Answer 1

1/3 or 33.33%

Step-by-step explanation:

The contribution margin ratio can be calculated using the following formula:

Contribution margin ratio=Contribution margin per unit /sales price per unit

In this question

Contribution margin per unit=$30

Sale price per unit=$90

Contribution margin ratio=30/90

=1/3 or 33.33%