Essay
Vaughn,Inc.sold 17,000 units last year for $50 each.Variable costs per unit were $15 for direct materials,$15 for direct labor,and $10 for variable overhead.Fixed costs were $10,000 in manufacturing overhead and $50,000 in nonmanufacturing costs.
a.What is the total contribution margin?
b.What is the unit contribution margin?
c.What is the contribution margin ratio?
d.If sales increase by 5,000 units,by how much will profits increase?
Correct Answer:
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a.$170,000 = (17,000 × $50)- [17,000 × (...View Answer
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