Question

Below is an incomplete contribution margin income statement for Barry's Coffee Cakes. Use this information to answer the following questions. BARRY'S COFFEE CAKES Contribution Margin Income Statement 20,000 units 25,000 units Total Total Per Unit Percents of Sales Sales revenue $ 150,000 Less: Variable costs 50,000 Contribution margin 100,000 Less: Fixed costs 30,000 Net operating income $ 70,000 Knowledge Check 01 What is the unit contribution margin

Answer 1

Answer:

Results are below.

Explanation:

Giving the following information:

Units sold: 20,000 or 25,000 is not clear.

Sales revenue $ 150,000

Less: Variable costs 50,000

Contribution margin 100,000

To calculate the unitary contribution margin, we need to use the following formula:

Unitary contribution margin= total contribution margin / number of untis

For 20,000 units:

Unitary contribution margin= 100,000/20,000= $5

For 25,000 units:

Unitary contribution margin= 100,000/25,000= $4