O'Dale sells three products: R, S, and T. Budgeted information for the upcoming accounting period follows. The company's weighted-average unit contribution margin is:
A) $3.00.
B) $3.55.
C) $4.00.
D) $19.35.
E) None of the other answers is correct.

Question

O'Dale sells three products: R, S, and T. Budgeted information for the upcoming accounting period follows.  The company's weighted-average unit contribution margin is:
A) $3.00. 
B) $3.55. 
C) $4.00. 
D) $19.35. 
E) None of the other answers is correct.

Quizplus · Accepted Answer

To calculate the weighted-average unit contribution margin, we need to find the total contribution margin and divide it by the total number of units. 
Total contribution margin = (1500 x $4.50) + (3000 x $3.00) + (2000 x $5.80) = $18,900 
Total units = 1500 + 3000 + 2000 = 6500 
Weighted-average unit contribution margin = $18,900 ÷ 6500 = $3.55. Therefore, the answer is B.

O'Dale Sells Three Products: R, S, and T