9.0k views
1 vote
Company sells a product for per unit. Variable costs are per​ unit, and fixed costs are per month. The company expects to sell units in . Calculate the contribution margin per​ unit, in​ total, and as a ratio.

User Nflacco
by
7.0k points

1 Answer

0 votes

Answer:

All the numbers are missing, so I looked for similar questions that can be used as an example:

Company sells a product for $15 per unit. Variable costs are $8 per​ unit, and fixed costs are $350,000 per month. The company expects to sell units 75,000. Calculate the contribution margin per​ unit, in​ total, and as a ratio.

contribution margin per unit = sales price - variable cost = $15 - $8 = $7

total contribution margin = contribution margin per unit x total sales = $7 x 75,000 = $525,000

contribution margin ratio = total contribution margin / total sales = $525,000 / ($15 x 75,000) = $525,000 / $1,125,000 = 0.4666 = 46.67%

User Victor Ortiz
by
8.7k points

No related questions found

Welcome to QAmmunity.org, where you can ask questions and receive answers from other members of our community.

9.4m questions

12.2m answers

Categories