Use the following information for questions
In September, Smith Company had the following financial statement amounts related to producing 500 units:
$\begin{array}{ll}
\text { Direct materials } & \$ 27,000 \
\text { Depreciation expense } &11,000\
\text { Sales revenue } & 95,000 \
\text { Direct labour } & 23,000 \
\text { Rent expense } & 25,000
\end{array}$
-How much is the contribution margin per unit?
A)$45,000
B)$9,000
C)$90
D)$18

Question

Use the following information for questions 
In September, Smith Company had the following financial statement amounts related to producing 500 units:
 $\begin{array}{ll}
\text { Direct materials } & \$ 27,000 \
\text { Depreciation expense } &11,000\
\text { Sales revenue } & 95,000 \
\text { Direct labour } & 23,000 \
\text { Rent expense } & 25,000
\end{array}$
-How much is the contribution margin per unit?
A)$45,000
B)$9,000
C)$90
D)$18

Quizplus · Accepted Answer

To find the contribution margin per unit, we need to subtract the variable costs per unit from the selling price per unit.

Contribution margin per unit = selling price per unit - variable cost per unit
= $120 - $30 - $90 / 500
= $0.18 or $18

Therefore, the correct answer is C) $18.

Use the Following Information for Questions in September, Smith

Use the Following Information for Questions
in September, Smith