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April 18, 2015

Homework Help: Concordia

Posted by Dawn on Wednesday, September 26, 2012 at 8:11pm.

All costs shown are on a per unit of product sold basis.

Sales = $18/unit
Direct Materials = $2/unit
Direct Labor = $2/unit
Variable Manufacturing Overhead = $2/unit
Variable selling and administrative expenses = $2/unit
Fixed Manufacturing Overhead = $2/unit at current volume levels
Fixed selling and administrative expenses = $2/unit at current volume levels

If the Variable Manufacturing Overhead decreased by $1/unit, Direct Labor increased by $1/unit , and Fixed Manufacturing Overhead increased by $2/unit, what would the change to the Contribution Margin be?

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