Question
Diana & Co makes a product, the Splash, which has a variable production cost of $6 per unit and a sales price of $10 per
Diana & Co makes a product, the Splash, which has a variable production cost of $6 per unit and a sales price of $10 per unit. At the beginning of September 2018, there were no opening inventories and production during the month was 20,000 units. Fixed costs for the month were $45,000 (production, administration, sales and distribution). There were no variable marketing costs.
Calculate the contribution and profit for September 2018, using marginal costing principles, if sales were as follows:
a. 10,000 Splashes
b. 15,000 Splashes
c. 20,000 Splashes
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