If the selling price is $22 per unit, what is the contribution margin per unit sold? (Round your answer to 2 d?

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Martinez Company’s relevant range of production is 7,500 units to 12,500 units. When it produces and sells 10,000 units, its unit costs are as follows:

Amount Per Unit

Direct materials $ 6.00

Direct labor $ 3.50

Variable manufacturing overhead $ 1.50

Fixed manufacturing overhead $ 4.00

Fixed selling expense $ 3.00

Fixed administrative expense $ 2.00

Sales commissions $ 1.00

Variable administrative expense $ 0.50

If the selling price is $22 per unit, what is the contribution margin per unit sold? (Round your answer to 2 decimal places.)

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2 Answers

  • Direct materials $ 6.00

    Direct labor $ 3.50

    Variable manufacturing overhead $ 1.50

    Sales commissions $ 1.00

    Variable administrative expense $ 0.50

    = $12.50 variable cost per unit

    22 – 12.50 = $9.50 CM per unit


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