A menu item sells for $4.99. The recipe for the item makes 24 servings and it costs

Question:

A menu item sells for $4.99. The recipe for the item makes 24 servings and it costs $52.56 to make the full recipe. What is the contribution margin for one serving of this item?

a. $2.80

b. $2.19

c. $4.80

d. $4.19

Contribution Margin
Contribution margin is an important element of cost volume profit analysis that managers carry out to assess the maximum number of units that are required to be at the breakeven point. Contribution margin is the profit before fixed cost and taxes...