Calculate the following based on the following information: Sales: $20 per unit (100,000 units) Variable costs:...
Calculate the following based on the following information:
Sales: $20 per unit (100,000 units)
Variable costs: $8 per unit
Fixed costs $350,000
a. what is the contribution margin in dollars?
b. what is the contribution margin per unit?
c. what is the contribution margin ratio?
Homework Answers
a. Contribution margin = sales - variable cost
= 20*100000 - 8*100000 = $1200000
b. Contribution margin = 20-8 = $12 per unit
c. Contribution margin ratio = contribution margin/ sales
= 12/20 = 60%
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