Question

Wight Corporation has provided its contribution format income statement for June. The company produces and sells a single product. Sales (4,300 units) $ 150,500 Variable expenses 73,100 Contribution margin 77,400 Fixed expenses 44,600 Net operating income $ 32,800 If the company sells 4,400 units, its total contribution margin should be _____

Answer 1

Answer:

its total contribution margin should be 79,200

Explanation:

Our first goal:

Calculate the contribution margin per unit

$77,400\div 4,300 = CM \:per \:unit\\CM \:per \:unit = 18$

Then we multiply by the sold units to get the new budgeted contribution margin.

$Unit \: Sold \times CM \:per \:unit = CM_{total}\\4,400 \times 18 = 79,200$