Question
Razor Inc. manufactures industrial components. One of its products used as a subcomponent in auto manufacturing is Fluoro2211. The selling price and cost per unit
Razor Inc. manufactures industrial components. One of its products used as a subcomponent in auto manufacturing is Fluoro2211. The selling price and cost per unit data for 9,110 units of Fluoro2211 are as follows. Per Unit Data Selling Price $ 370 Direct Materials 130 Direct Labor 26 Variable Manufacturing Overhead 23 Fixed Manufacturing Overhead 41 Variable Selling 14 Fixed Selling and Administrative 21 Total Costs 255 Operating Margin $ 115 During the next year, sales of Fluoro2211 are expected to be 10,110 units. All costs will remain the same except for fixed manufacturing overhead, which will increase by 20%, and direct materials, which will increase by 10%. The selling price per unit for next year will be $380. Based on these data, Razor Inc.'s total contribution margin for next year will be: (CMA adapted) Multiple Choice $1,561,140. $1,659,140. $1,651,140. $1,759,140.
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