A Packaging Company Produces a Variety of Cardboard Boxes in an Automated

Multiple Choice

A packaging company produces a variety of cardboard boxes in an automated process. Expected production per month is 160,000 units. The required direct materials costs $0.30 per unit. Variable manufacturing overhead costs are $24,000 per month and are allocated based on units of production. Direct labour is budgeted to be $6,400. The company only produces based on customer orders, so all production is considered sold as it is produced. Revenue for the month will be $240,000. What is the budgeted contribution margin per unit?

A) $1.50 per unit
B) $1.31 per unit
C) $1.16 per unit
D) $1.05 per unit
E) $1.01 per unit