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The following report reflects numerical data for Polar Corporation in July: Sales $27,000 Variable costs $11,880 Fixed costs $7,000 What is the contribution margin per unit if 10,800 units were sold in July?

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Answer:

$1.40

Explanation:

The total contribution margin is determined by deducting variable costs from sales during the period:

[tex]CM = \$27,000 -\$11,880\\CM = \$15,120[/tex]

Assuming a production of 10,800 units, the contribution margin per unit is:

[tex]CM_u = \frac{\$15,120}{10,800}\\CM_u =\$1.40[/tex]

The contribution margin per unit in July is $1.40.

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