Question

For Crane Company at a sales level of 4000 units, sales is $65000, variable expenses total $40000, and fixed expenses are $21000. What is the contribution margin per unit

Answer 1

Unitary contribution margin= $6.25

Step-by-step explanation:

Giving the following information:

For Crane Company at a sales level of 4000 units, sales is $65000, variable expenses total $40000

Contribution margin= selling price - unitary variable cost

First, we calculate the total contribution margin:

total contribution margin= 65,000 - 40,000

total contribution margin= 25,000

Now, the unitary contribution margin:

unitary contribution margin= 25,000/4,000

unitary contribution margin= $6.25