Rocky Mountain Bottling Company Produces a Soft Drink That Is

Multiple Choice

Rocky Mountain Bottling Company produces a soft drink that is sold for a dollar. At production and sales of 800,000 units, the company pays $600,000 in production costs, half of which are fixed costs. At that volume, general, selling, and administrative costs amount to $250,000 of which $70,000 are fixed costs. What is the amount of contribution margin per unit?

A) $0.400
B) $0.5375
C) $0.250
D) None of these is correct.