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taurus [48]
3 years ago
8

Gena Manufacturing Company has a fixed cost of $225,000 for the production of tubes. Estimated sales are 150,000 units. A before

tax profit of $125,000 is desired by the controller. If the tubes sell for $5 each, what unit contribution margin is required to attain the profit target?
$1.47.
$2.33.
$3.00.
$0.90.
Business
1 answer:
kykrilka [37]3 years ago
7 0

Answer: $2.33

Explanation:

The unit contribution margin that is required to attain the profit target will be calculated thus:

= (Fixed cost + Desired profit) / Estimated units

= ($225,000 + $125,000) / 150,000

= $350,000 / 150,000

= $2.33

Therefore, the unit contribution margin is $2.33

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3 years ago
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