At a volume level of 500,000 units, Sullivan reported the following information: $\begin{array}{lr}
\text { Sales price } & \$ 60 \
\text { Variable cost per unit } & 20 \
\text { Fixed cost per unit } & 4
\end{array}$ The company's contribution-margin ratio is closest to:

Question

Quizplus · Accepted Answer

The contribution margin per unit is calculated as Sales price - Variable cost per unit = $60 - $20 = $40. The contribution-margin ratio is the contribution margin per unit divided by the sales price, which is $40 / $60 = 0.67.

At a Volume Level of 500,000 Units, Sullivan Reported the Following