A product has a sales price of $746 and a per-unit contribution margin of $131. What is the contribution margin ratio? Round to the nearest percentage, no decimals.

Principles of Accounting Volume 2
19th Edition
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax
Chapter3: Cost-volume-profit Analysis
Section: Chapter Questions
Problem 3EB: A product has a sales price of $175 and a per-unit contribution margin of $75. What is the...
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A product has a sales price of $746 and a per-unit contribution margin of $131. What is the
contribution margin ratio? Round to the nearest percentage, no decimals.
Transcribed Image Text:A product has a sales price of $746 and a per-unit contribution margin of $131. What is the contribution margin ratio? Round to the nearest percentage, no decimals.
Expert Solution
Step 1

Formula:

Contribution margin ratio = Per unit contribution margin / sales price

Division of per unit contribution margin with sales price derives the contribution margin ratio.

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