LMN Company produces a product that sells for $1. The company has production costs of $600,000, half of which are fixed costs. A

Question

Korolek [52]

3 years ago

9

LMN Company produces a product that sells for $1. The company has production costs of $600,000, half of which are fixed costs. A

ssuming production and sales of 750,000 units, the contribution margin per unit is $ ____.

Business

1 answer:

madam [21] · Answer 1 · 2022-01-27T15:53:34+03:00

Answer:

Unitary Contribution margin= $0.6

Explanation:

Giving the following information:

LMN Company produces a product that sells for $1. The company has production costs of $600,000, half of which are fixed costs. Assuming the production and sales of 750,000 units.

Variable cost= 600,000/2= $300,000

Unitary variable cost= 300,000/750,000= $0.4

Unitary Contribution margin= 1 - 0.4= $0.6

Total contribution margin= $450,000