Answer:
$28
Explanation:
Step 1:
If a company sells a product at $60 each and makes a sale of $15,000, the number of units of items produced is
$15,000 ÷ $60 = 250 units.
Step 2:
To calculate the company's contribution margin per unit,
we have, (unit selling prices - unit production cost)
unit selling price is #60
unit cost of production is (total cost of prodcution ÷ number of units)
total cost of production is $4,000+ $1,000+ $2,000+ $1,000 = $8000
Unit cost of production is $8000 ÷ 250 = $32
i.e it takes $32 to manufacture 1 product.
Contribution margin = $60 - $32
= $28
∴ the contribution margin is $28.
Cheers.
