A cement manufacturer has supplied the following data:

A cement manufacturer has supplied the following data:

Tons of cement produced and sold		266,000
Sales revenue	$	1,197,000
Variable manufacturing expense	$	435,000
Fixed manufacturing expense	$	232,000
Variable selling and administrative expense	$	97,000
Fixed selling and administrative expense	$	222,000
Net operating income	$	211,000

What is the company's unit contribution margin? (Round your intermediate calculations to 2 decimal places.)

Garrison 16e Rechecks 2017-08-04

Multiple Choice

• $4.50 per unit
• $0.52 per unit
• $2.00 per unit
• $2.50 per unit

  Correct

Explanation

Unit contribution margin = Selling price per unit – Variable expenses per unit

= ($1,197,000 ÷ 266,000 units) – (($435,000 + $97,000) ÷ 266,000 units)

= ($1,197,000 ÷ 266,000 units) – ($532,000 ÷ 266,000 units)

= $4.50 per unit – $2.00 per unit = $2.50 per unit