In order to calculate the weighted-average contribution margin (WACM) for a group of different products, which of the following pieces of information is needed?
A) Fixed costs per unit of product sold
B) The degree of operating leverage
C) Overhead costs for each different product
D) The sales mix for the different products

Question

Quizplus · Accepted Answer

When working with multiple products and a sales mix of these products, an average contribution margin, called the weighted average contribution margin (WACM), is needed for the break-even calculation. The WACM cannot be calculated without sales mix information.

In Order to Calculate the Weighted-Average Contribution Margin (WACM) for a Group