Exercise 176 (Part Level Submission) In the month of September, Matlock Industri
ID: 2562109 • Letter: E
Question
Exercise 176 (Part Level Submission)
In the month of September, Matlock Industries sold 800 units of product. The average sales price was $30. During the month, fixed costs were $6,300 and variable costs were 70% of sales.
(a)
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(b)
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Exercise 176 (Part Level Submission)
In the month of September, Matlock Industries sold 800 units of product. The average sales price was $30. During the month, fixed costs were $6,300 and variable costs were 70% of sales.
Explanation / Answer
Per Unit Unit Sold Total Cost Sales $30 $800 $24,000 Less: Variable Cost 70% $21 $800 $16,800 Contribution $9 $7,200 Less: Fixed Cost $6,300 Net Profit $900 Answer= Contribution Margin (in dollars)= $900 Unit Contribution Margin = $9 Per Unit Contribution Margin Ratio = Contribution Margin / Sales Contribution Margin Ratio = $ 9 / $ 30 Contribution Margin Ratio = 0.30 or 30%
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