Question

Flannigan Company manufactures and sells a single product that sells for $620 per unit; variable costs are $372. Annual fixed costs are $868,000. Current sales volume is $4,370,000. Compute the contribution margin per unit.

Answer 1

Answer:

$248 per unit

Explanation:

Given that

Selling price per unit = $620

Variable cost per unit = $372

Fixed cost = $868,000

Current sales volume = $4,370,000

The formula and the computation of the contribution margin per unit is shown below:

Contribution margin per unit = Selling price per unit - Variable expense per unit

= $620 - $372

= $248 per unit