Question

g "A company with monthly fixed costs of $280,000 expects to earn monthly operating income of $80,000 by selling 12,000 units per month. What is the company's expected unit contribution margin?"

Answer 1

unitary contribution margin= $30

Step-by-step explanation:

Giving the following information:

Fixed costs= $280,000

Operating income= $80,000

Units sold= 12,000

First, we need to calculate the total contribution margin:

total contribution margin= operating income + fixed costs

total contribution margin= 80,000 + 280,000

total contribution margin= $360,000

Now, the unitary contribution margin:

unitary contribution margin= 360,000/12,000= $30