Question

Zhao Co. has fixed costs of $319,200. Its single product sells for $169 per unit, and variable costs are $113 per unit. The company expects sales of 10,000 units. Prepare a contribution margin income statement for the year ended December 31, 2019

Answer 1

$560,000

Step-by-step explanation:

Contribution margin income statement for the year ended December 31, 2019

Sales(10,000×$169)=$1,690,000

Variable costs(10,000×113)=$1,130,000

Contribution margin

169-113= 56 units

(10,000×56)=$560,000

Therefore the contribution margin is $560,000