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View Full Version : Sales price per unit formula


acampa45
Feb 23, 2011, 07:34 PM
Hello,

I have to figure sales price per unit given unit variable expenses, total fixed expenses, and contribution margin ratio. Can you please let me know how I figure sales price per formula?

Thank you for your help!

ArcSine
Feb 24, 2011, 06:14 AM
The contribution margin ratio M is the ratio M \ = \ \frac{P-V}{P} where P and V denote the unit Price and unit Variable cost, respectively.

Since you're given M and V, you can derive P from the equation.