Question

Given a contribution margin of $20, if 10,000 units are produced at a cost of $400,000 what is the sales revenue in USD? Pls explain how u got the answer

A) $200,000
B) $300,000
C) $60
D) $600,000

Answer 1

Answer: $600,000

Explanation:

The sales revenue will be gotten as:

= Cost + Contribution Margin

where,

Cost = $400,000

Contribution Margin = $20 x 10,000 = $200,000

Therefore, Sales revenue will be:

= $400,000 + $200,000

= $600,000