A company sells three different types of satellite dishes in Ontario,but sells only (type 1)in Alberta.Available data are that the budgeted sales mix percentage in Ontario is .35 (type 1),and .25 (type 2).The contribution margins per unit are $200 (1),$120 (2),and $140(3).
Required:
Calculate the budgeted contribution margin per composite unit for the budgeted mix for Ontario and Alberta respectively.

Question

Quizplus · Accepted Answer

In Ontario, the budgeted sales mix is 35% for type 1, 25% for type 2, and 40% for type 3 (since the total must be 100%). The contribution margin per composite unit is calculated as: (0.35 * $200) + (0.25 * $120) + (0.40 * $140) = $156. In Alberta, only type 1 is sold, so the contribution margin per unit is $200.

A Company Sells Three Different Types of Satellite Dishes in Ontario,but