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Homework answers / question archive / Slamburger's sells three cheeseburgers for every two regular hamburgers
Slamburger's sells three cheeseburgers for every two regular hamburgers. A cheeseburger sells for $3.50 with a variable cost of $1.00. A regular hamburger sells for $3 with a variable cost of $0.75. What is the weighted average contribution margin?
A) $0.60
B) $2.40
C) $0.42
D) $4.20
Answer: B
Explanation: B)
|
|
Cheeseburger |
Hamburger |
Total |
|
Sales |
$3.50 |
$3.00 |
|
|
Variable Costs |
1.00 |
0.75 |
|
|
Contribution Margin |
$2.50 |
$2.25 |
|
|
× Sales Mix |
3 |
2 |
5 |
|
Contribution margin |
$7.50 |
$4.50 |
$12.00 |
Contribution Margin $12.00 / 5 Sales Mix = $2.40 Weighted CM
