Question
How does this expert come up with $12 in variable costs? It seems to me that -$50K in profit when producing 10,000 units means that
How does this expert come up with $12 in variable costs? It seems to me that -$50K in profit when producing 10,000 units means that revenue was $600K, costs were -$650K, fixed costs were $250K, which means that remaining variable costs are 400K. 400K/10000 units = $40 in variable costs per unit (not $12). Thus contribution margin is $60 - $40 = $20.
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Modern Advanced Accounting In Canada
Authors: Hilton Murray, Herauf Darrell
7th Edition
1259066487, 978-1259066481
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