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likoan [24]
3 years ago
7

Chester's product manager is considering lowering the price of the Cone product by $2.50 and wants to know what the impact will

be on the product’s contribution margin. Assuming no inventory carry costs, what will Cone's contribution margin be if the price is lowered?
Business
1 answer:
lozanna [386]3 years ago
7 0

Answer:

The contribution margin will decrease by 2.50

Explanation:

Sales \: Revenue - Variable \: Cost = Contribution \: Margin

IF sales decreases, then the contribution margin decreases.

That's because, there is less money to pay for the variable cost.

The company will also have to sale more units to break even, as now each units contribution is fewer.

Cone's should evaluate how much their sales are expected to increase for the lower price and be cautious

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How do political factors affect businesses
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e. $638

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now the actual rate after 90 days is 1.638

payment at 1.638 rate = 39960/ 1.638

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Excerpts from Huckabee Company's December 31, 2021 and 2020, financial statements are presented below: 2021 2020 Accounts receiv
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