Asked by Raihan Rahman on Sep 22, 2024
A manufacturing company is considering producing a new product. The variable cost of the new product is $60 per unit, and the total fixed costs are $75,000 for a month. The company could produce 1,500 units per month, and sell the product for $125 each. Calculate the unit contribution margin.
A) 65
B) 50
C) 60
D) 125
E) 80
Variable Cost
Costs that change in proportion to the level of production or business activity, such as materials and labor.
- Analyze and perceive the importance of the contribution margin per unit and in its entirety.
- Examine the monetary viability of fabricating a novel product, with attention to production capacity, fluctuating costs, and invariable costs.
Learning Objectives
- Analyze and perceive the importance of the contribution margin per unit and in its entirety.
- Examine the monetary viability of fabricating a novel product, with attention to production capacity, fluctuating costs, and invariable costs.