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3 years ago

PB1.

Business

1 answer:

vlabodo [156]3 years ago

8 0

Answer:

Contribution margin per unit = $85 per cubic yard

Contribution margin ratio = 56.67%

Explanation:

The computations are calculated below:

Contribution margin per unit = Selling price per cubic yard - variable cost cubic yard

= $150 - $65

= $85 per cubic yard

Contribution margin ratio would be

= (Contribution margin per cubic yard) ÷ (Selling price per cubic yard) × 100

= ($85) ÷ ($150) × 100

= 56.67%

And, The statement of contribution margin income for the month of August is shown below:

Sales (240 cubic yards × $150) $36,000

Less: Variable cost (240 cubic yards × $65) ($15,600)

Contribution margin $20,400

Less: Fixed expenses per month ($15,000)

Net income $5,400

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