Answer:
Variable Costing | a | b | c |
Net Sales Revenue | $324,000 | $324,000 | $324,000 |
Total Variable Costs | ($214,000) | ($214,000) | ($214,000) |
Contribution Margin | $110,000 | $110,000 | $110,000 |
Calculations:
Net sales revenue = Units sold x Selling price per unit
Total variable Costs = Units sold x Total unit product cost
Contribution margin = Net sales revenue - Total Variable Costs
Fixed costs do not consider while calculating the Contribution margin.
In all three scenarios number of units sold, selling price per unit and Total unit product cost are the same. Therefore,
a | b | c | |
Net Sales Revenue [2,000 x $162] | $324,000 | $324,000 | $324,000 |
Total Variable Costs [2,000 x $107] | ($214,000) | ($214,000) | ($214,000) |
Contribution Margin | $110,000 | $110,000 | $110,000 |
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