IMA Shop Ltd produces three products. Cost, price, and volume data is shown below:
* Total Fixed Costs: $2,400
* Tax Rate: 30%
$$\begin{array} { | l | l | l | l | }
\hline & \text { Chacolate Ice Creamn } & \text { Milkthale } & \text { Furger } \
\hline \text { Narmal Valume } & 300 & 150 & 200 \
\hline \text { Price per unit } & \$ 5 & \$ 7 & \$ 10 \
\hline \text { Var iable cast per unit } & \$ 2 & \$ 3 & \$ 4 \
\hline
\end{array}$$ The weighted average contribution margin, rounded to the nearest whole dollar, is

Question

IMA Shop Ltd produces three products. Cost, price, and volume data is shown below: 
* Total Fixed Costs: $2,400
* Tax Rate: 30%
$$\begin{array} { | l | l | l | l | } 
\hline & \text { Chacolate Ice Creamn } & \text { Milkthale } & \text { Furger } \
\hline \text { Narmal Valume } & 300 & 150 & 200 \
\hline \text { Price per unit } & \$ 5 & \$ 7 & \$ 10 \
\hline \text { Var iable cast per unit } & \$ 2 & \$ 3 & \$ 4 \
\hline
\end{array}$$ The weighted average contribution margin, rounded to the nearest whole dollar, is

Quizplus · Accepted Answer

The weighted average contribution margin is calculated by finding the contribution margin per unit for each product (price per unit - variable cost per unit), multiplying each by its volume, summing these products, and then dividing by the total volume. For Chocolate Ice Cream: (5-2)*300 = 900, for Milkshake: (7-3)*150 = 600, for Furger: (10-4)*200 = 1200. Total contribution = 900+600+1200 = 2700. Total volume = 300+150+200 = 650. Weighted average contribution margin = 2700 / 650 = 4.15, rounded to $4.16.

IMA Shop Ltd Produces Three Products The Weighted Average Contribution Margin, Rounded to the Nearest Whole