Question

Our company sells a product for $150 per unit. Variable costs are $90 per unit and fixed costs are $18,000. The company expects to sell 800 units this year. What is the contribution margin in total dollars

Answer 1

$48,000

Step-by-step explanation:

From the question, we are given the following;

Per unit selling price of the product = $150

Variable costs per unit = $90

Fixed costs = $18,000

Expected units to be sold 800

Therefore,

Contribution margin in dollars = Selling price - Variable costs

= ($150 × 800) -($90 × 800)

= $120,000 - $72,000

=$48,000