A company has a unit contribution margin of $120 and a contribution margin ratio of 40%. What is the unit selling price?
A) $200
B) $300
C) $48
D) Cannot be determined.

Question

Quizplus · Accepted Answer

The contribution margin ratio is calculated as the unit contribution margin divided by the unit selling price. Therefore, $120 / Selling Price = 40%, which means the selling price is $300.

A Company Has a Unit Contribution Margin of $120 and a Contribution