Your business has the following information for 2020: Sales 235586 Variable manufacturing cost 39613 Fixed manufacturing cost 38740 Variable non-manufacturing cost 21261 Fixed non-manufacturing cost 42438 Units sold 65805 Fixed non-manufacturing cost includes $3000 of loss on sale of land

Accounting Apr 19, 2021

Your business has the following information for 2020: Sales 235586 Variable manufacturing cost 39613 Fixed manufacturing cost 38740 Variable non-manufacturing cost 21261 Fixed non-manufacturing cost 42438 Units sold 65805
Fixed non-manufacturing cost includes $3000 of loss on sale of land. This is non-operating in nature. All other costs are operating in nature.
What is the contribution margin?
Answer:

Expert Solution

Statement Showing Contribution Margin, Contribution Margin per Unit and Operating Margin:
	Amount	Per Unit
Sales ($235,586/65,805)	$235,586	$3.58
Less: Variable Manufacturing Cost ($39,613/65,805)	39613	$0.60
Gross Margin	$195,973	$2.98
Less: Variable Non-manufacturing Cost ($21,261/65,805)	21261	$0.32
Contribution Margin	174,712	$2.65
Less: Fixed Manufacturing Cost	38740
Less: Fixed Operating Non-manufacturing Cost ($42,438-$3,000)	39438
Operating Margin	96,534

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