Baines Brothers manufactures and sells two products, A and Z in the ratio of 4:2. Product A sells for $75; Z sells for $95. Variable costs for product A are $35; for Z $40. Fixed costs are $418,500. Compute the contribution margin per composite unit.

A) $270.
B) $240.
C) $300.
D) $330.
E) $285.

Question

Sierra McCray · Accepted Answer

Final Answer : A, Explanation :  Contribution Margin per composite unit = (4 x $75 - 4 x $35) + (2 x $95 - 2 x $40) = $270

Baines Brothers manufactures and sells two products, A and Z in the ratio of 4:2. Product A sells for $75; Z sells for $95. Variable costs for product A are $35; for Z $40. Fixed costs are $418,500. Compute the contribution margin per composite unit.

A) $270.
B) $240.
C) $300.
D) $330.
E) $285.

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Learning Objectives

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Baines Brothers manufactures and sells two products, A and Z in the ratio of 4:2. Product A sells for $75; Z sells for $95. Variable costs for product A are $35; for Z $40. Fixed costs are $418,500. Compute the contribution margin per composite unit.A) $270.B) $240.C) $300.D) $330.E) $285.

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Learning Objectives

Learning Objectives

Related questions

Baines Brothers manufactures and sells two products, A and Z in the ratio of 4:2. Product A sells for $75; Z sells for $95. Variable costs for product A are $35; for Z $40. Fixed costs are $418,500. Compute the contribution margin per composite unit.

A) $270.
B) $240.
C) $300.
D) $330.
E) $285.