To find the weighted average contribution margin, a company adds up the individual unit contribution margins of the different products and then divides by the number of different products.

Question

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To find the weighted average contribution margin, a company must multiply each individual unit contribution margin by the proportion of total sales that each product represents. The weighted individual unit contribution margins are then added up and divided by the total number of units sold.

To Find the Weighted Average Contribution Margin, a Company Adds