Spice Company has a product which sells for $150 and has a unit contribution margin of $75

Accounting Mar 01, 2021

Spice Company has a product which sells for $150 and has a unit contribution margin of $75. It has fixed costs of $35/unit at the current production volume. Spice Company's contribution margin ratio is

A) 23%.

B) 50%.

C) 37%.

D) 73%.

Expert Solution

Answer: B

Explanation: B)

Contribution Margin $75 divided by $150 = 50%

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