Answer:
The contribution margin for the month is $120,000
Explanation:
The computation of the contribution margin for the month is as follows;
But before that we do the following calculations
Total variable cost per unit is
Direct materials $13
Direct labor $35
Variable manufacturing overhead $1
Variable selling and administrative $10
Total is $59
And, the selling price per unit is $89
So, the contribution margin per unit is
= Selling price per unit - variable cost per unit
= $89 - $59
= $30
And, the number of unit sold is 4,000
So, the contribution margin for the month is
= 4,000 × $30
= $120,000
Hence, the contribution margin for the month is $120,000
