Consider the scenario below:A TV manufacturer and seller sold 50 units for a total of P3,750,000 worth of television sets for the month of August 2018. Fixed Expenses at P1,000,000 and Variable Expenses at P888,000.Compute for the CM per unit.Select one:a.57,240b.54,270c.52,740d.75,240
Question
Consider the scenario below:A TV manufacturer and seller sold 50 units for a total of P3,750,000 worth of television sets for the month of August 2018. Fixed Expenses at P1,000,000 and Variable Expenses at P888,000.Compute for the CM per unit.Select one:a.57,240b.54,270c.52,740d.75,240
Solution
To compute for the Contribution Margin (CM) per unit, we first need to calculate the total contribution margin, and then divide it by the number of units sold.
Step 1: Calculate the total revenue The total revenue is given as P3,750,000.
Step 2: Calculate the total variable costs The total variable costs are given as P888,000.
Step 3: Calculate the total contribution margin The total contribution margin is calculated by subtracting the total variable costs from the total revenue. So, P3,750,000 - P888,000 = P2,862,000.
Step 4: Calculate the CM per unit The CM per unit is calculated by dividing the total contribution margin by the number of units sold. So, P2,862,000 / 50 = P57,240.
So, the CM per unit is P57,240. Therefore, the answer is a.57,240.
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