Ask Experts Questions for FREE Help !
Ask
    victorlyh1990's Avatar
    victorlyh1990 Posts: 3, Reputation: 1
    New Member
    		  
    #1

    Oct 7, 2012, 01:11 AM
    Contribution margin per unit.
    Based on the information provided below, calculate the contribution margin per unit.

    Units sold 2,000
    Selling price per unit $5.00
    Direct labour costs $3,000
    Raw materials costs $2,000
    Machinery cost $2,500
    ebaines's Avatar
    ebaines Posts: 12,131, Reputation: 1307
    Expert
    		  
    #2

    Oct 8, 2012, 10:47 AM
    Contribution margin is revenue minus variable costs of manufacture (costs that are incurred with every unit sold). It does not include overhead costs that you incur regardless of how many units you make - such as capital expenses and depreciation, real estate taxes, R&D expenses, etc. So from the list of expenses you provided, can you tell us which ought to be included in the contribution analysis? Contribution margin per unit is the contribution divided by number of units sold.
Not your question? Ask your question View similar questions
 

Question Tools Search this Question
Search this Question:

Advanced Search

Add your answer here.


Check out some similar questions!

Trying to calculate the contribution margin per unit [ 2 Answers ]

Zeitgeist Company manufactures silicon sleeves for MP3 players. In August 2011, Zeitgeist began producing the colorful sleeves. During the month of August, 16,000 were produced, and 14,750 were sold at $6.95 each. Direct Materials $ 26,880 Direct labor $ 6720 Variable overhead $ 5920 Fixed...

Incremental contribution margin per unit (excluding material and cutting costs) [ 0 Answers ]

Incremental contribution margin per unit (excluding material and cutting costs)

The budget contribution margin per unit? [ 1 Answers ]

Tie One on budgeted for production and sales of 12,000 silk ties, but actually produced 11,000 and sold 10,500. Each tie has the following standards: 1 foot of material at a budgeted cost of $1.50 per foot and 20 minutes of sewing time at a cost of $0.25 per unit. The ties sell for $8. Actual...

Sales Price per unit, contribution margin ratio [ 1 Answers ]

Having a problem with finding a sales price per unit.

Determine the contribution margin in dollars, per unit, and as a ratio. [ 1 Answers ]

In the month of June, Mandeep's Beauty Salon gave 2,700 haircuts, shampoos, and permanents at an average price of $30. During the month, fixed costs were $18,000 and the variable costs were 75% of sales. How do I calculate the variable costs to determine the contribution margin in dollars, per...

View more questions Search