Satinwood Company sells two product finishes-Mahogany and Aspen.Satinwood predicts that it will sell 7,200 units of Mahogany and 5,600 units of Aspen in the next period.The unit contribution margins are $3.15 and $6.30,respectively.What is the weighted-average unit contribution margin?

Question

Quizplus · Accepted Answer

D) Weighted contribution = (7,200 × $3.15) + (5,600 × $6.30) = $57,960
Weights = 7,200 units + 5,600 units = 12,800 units
Weighted-average contribution margin per unit = $57,960 / 12,800 = $4.53

Satinwood Company Sells Two Product Finishes-Mahogany and Aspen