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Q4SE

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Horngren'S Financial And Managerial Accounting
Found in: Page 1121

Short Answer

Calculating contribution margin

Glenn Company sells a product for $80 per unit. Variable costs are $60 per unit, and fixed costs are $800 per month. The company expects to sell 560 units in September. Calculate the contribution margin per unit, in total, and as a ratio.

  1. Contribution margin per unit=$20
  2. Contribution margin in total = $11,200
  3. Contribution margin ratio = 25%
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Step by Step Solution

Calculation of contribution margin per unit

Calculation of contribution margin in total

Calculation of contribution margin ratio

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