Calculation Of Contribution Margin Per Unit

Question

Carr Company produces a single product. During the past year, Carr manufactured 33,930 units and sold 28,300 units. Production costs for the year were as follows:

Fixed manufacturing overhead           $542,880

Variable manufacturing overhead       $288,405

Direct labor                                         $145,899

Direct materials                                   $288,405

Sales totaled $1,287,650, variable selling expenses totaled $164,140, and fixed selling and administrative expenses totaled $206,973. There were no units in beginning inventory. Assume that direct labor is a variable cost. The contribution margin per unit would be:

a. $18.40

b. $19.50

c. $13.90

d. $24.20

Summary

The question belongs to Accounting and it discusses about calculation of contribution margin per unit.

Total Word Count 32