The contribution margin per unit of a given product guides managers when deciding which product to emphasize in a sales mix.

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Contribution margin per unit is the amount by which the unit selling price of a product exceeds its variable cost per unit. Knowing the contribution margin per unit helps managers make decisions about which products to focus on in a sales mix. A higher contribution margin per unit means more profit can be made from selling that product, so managers may choose to emphasize it over products with lower contribution margins per unit.

The Contribution Margin Per Unit of a Given Product Guides