If selling price is $20 per unit and variable costs are $14 per unit, the contribution margin is:Group of answer choices$1.43 per unit.$280.$6 per unit.$34 per unit.
Question
If selling price is 14 per unit, the contribution margin is:Group of answer choices280.34 per unit.
Solution
The contribution margin is calculated by subtracting the variable cost per unit from the selling price per unit.
Here's how you can calculate it:
Step 1: Identify the selling price per unit. In this case, it's $20.
Step 2: Identify the variable cost per unit. In this case, it's $14.
Step 3: Subtract the variable cost per unit from the selling price per unit.
So, 14 (Variable cost per unit) = $6 per unit.
Therefore, the contribution margin is $6 per unit.
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