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During the year, the company produced and sold 40,000 units of product at a selling price of $14.43 per unit. There was no beginning inventory of product at the beginning of the year. What is the contribution margin for the year

Respuesta :

abiolataiwo2015

Answer:

$392,200

Explanation:

Calculation for the contribution margin for the year

Using this formula

Contribution Margin= Sales-Variable costs

Let plug in the formula

Contribution Margin=(14.43 per unitsx 40,000 units) - $185,000

Contribution Margin=$577,200-$185,000

Contribution Margin=$392,200

Calculation for variable costs

Manufacturing $114,000

Marketing: 31,000

Administrative: 40,000

Total variable costs=$185,000

Therefore the contribution margin for the year will be $392,200