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Souza Inc, which produces and sells a single product, has provided its contribution format income statement for October. Sales (4,000 units) $ 88,000 Variable expenses 40,000 Contribution margin 48,000 Fixed expenses 41,700 Net operating income $ 6,300 If the company sells 3,600 units, its total contribution margin should be closest to:

Respuesta :

Answer:

$43,200

Explanation:

The computation of the total contribution margin is shown below

But before that first we have to determine the contribution Margin per unit

Contribution margin per unit = Contribution margin ÷ Selling units

= $48,000 ÷ 4,000

= $12

Now if the 3,600 sale units is there

So, the total contribution margin is

=  Sales units × Contribution margin per unit

= 3,600 sales unit × $12

= $43,200

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