Weatherspoon Company has a product with a selling price per unit of $200, the unit variable cost is $90, and the total monthly fixed costs are $300,000.How much is Weatherspoon's contribution margin ratio?
A)55%
B)45%
C)150%
D)222%

Question

Quizplus · Accepted Answer

The contribution margin per unit is calculated as the selling price per unit ($200) minus the variable cost per unit ($90), which equals $110. The contribution margin ratio is then the contribution margin per unit ($110) divided by the selling price per unit ($200), resulting in 0.55 or 55%.

Weatherspoon Company Has a Product with a Selling Price Per