If the weighted contribution margin ratio for a multi-product manufacturing company is 45%, the weighted contribution margin per unit is $5, fixed costs are $100,000, and total revenues are $650,000, how much is profit before taxes?

Question

Quizplus · Accepted Answer

The profit before taxes can be calculated using the formula: Profit = (Weighted Contribution Margin Ratio * Total Revenues) - Fixed Costs. Substituting the given values: Profit = (0.45 * $650,000) - $100,000 = $292,500 - $100,000 = $192,500.

If the Weighted Contribution Margin Ratio for a Multi-Product Manufacturing