Calculate the contribution per unit for the existing machine
A)£1.00.
B)£1.32
C)£1.12.
D)£1.62.

Question

Quizplus · Accepted Answer

To calculate the contribution per unit for the existing machine, we need to subtract the variable cost per unit from the selling price per unit.

Contribution per unit = Selling price per unit - Variable cost per unit

From the given data, we know that the selling price per unit is £7.50 and the variable cost per unit is £6.38.

Contribution per unit = £7.50 - £6.38 = £1.12

Therefore, the best choice is C) £1.12 as it is the correct contribution per unit for the existing machine.

Calculate the Contribution Per Unit for the Existing Machine