If the company sells 5,900 units, its total contribution margin should be closest to:
A)$148,000
B)$128,800
C)$135,700
D)$21,493

Question

Quizplus · Accepted Answer

To calculate the total contribution margin, we need to multiply the contribution margin per unit by the number of units sold.

Contribution margin per unit = selling price per unit - variable costs per unit

Given: 
- Selling price per unit = $40 
- Variable costs per unit = $12

Contribution margin per unit = $40 - $12 = $28

Total contribution margin for 5,900 units = 5,900 units x $28 per unit = $165,200

Therefore, the closest choice to the total contribution margin is C) $135,700.

If the Company Sells 5,900 Units, Its Total Contribution Margin