Question

produces sports socks. The company has fixed expenses of $ 80 comma 000 and variable expenses of $ 0.80 per package. Each package sells for $ 1.60. Read the requirementsLOADING.... Requirement 1. Compute the contribution margin per package and the contribution margin ratio. Begin by identifying the formula to compute the contribution margin per package. Then compute the contribution margin per package. ​(Enter the amount to the nearest​ cent.)

Answer 1

Instructions are below.

Step-by-step explanation:

Giving the following information:

Unitary variable expenses= $ 0.80

Selling price per unit= $ 1.60

First, we need to calculate the unitary contribution margin:

Unitary contribution margin= selling price - unitary variable cost

Unitary contribution margin= 1.6 - 0.8

Unitary contribution margin= $0.8

Now, the contribution margin ratio:

contribution margin ratio= contribution margin / sellig price

contribution margin ratio= 0.8/1.6

contribution margin ratio= 0.5