Question

Chance, Inc. sold 4,800 units of its product at a price of $162 per unit. Total variable cost per unit is $123, consisting of $86 in variable production cost and $37 in variable selling and administrative cost. Compute the manufacturing margin for the company under variable costing.

Answer 1

Manufacturing margin= $364,800

Step-by-step explanation:

Giving the following information:

Units sold= 4,800

Selling price= $162

Total unitary variable production cost= $86

To calculate the manufacturing margin, we will take into account only the variable manufacturing costs.

Manufacturing margin= sales - total variable production cost

Manufacturing margin= 4,800*162 - 4,800*86

Manufacturing margin= $364,800