Ben's Landscaping sells two types of mulch for residential use.Cypress mulch constitutes 35% of all sales and pine mulch the other 65%.What is the weighted unit contribution margin for Ben's inventory if cypress mulch sells for $2.00 per pound and pine mulch sells for $1.50 per pound?

Question

Quizplus · Accepted Answer

To calculate the weighted unit contribution margin, we need to first calculate the weighted average selling price and the weighted average cost.

Weighted average selling price:

(0.35 x $2.00/pound) + (0.65 x $1.50/pound) = $0.70 + $0.975 = $1.675/pound

Weighted average cost:

We don't have enough information to calculate the weighted average cost, so we can't find the weighted unit contribution margin. Therefore, we can eliminate choices A, C, and D.

The best choice is B.

Ben's Landscaping Sells Two Types of Mulch for Residential Use