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The following cost information pertained to the Violin Division of Stringing Music Co. and was based on monthly demand and sales of 100 units: Per-Unit

The following cost information pertained to the Violin Division of Stringing Music Co. and was based on monthly demand and sales of 100 units:

Per-Unit Costs
Variable production costs:
Direct materials $ 170
Direct labor 200
Variable factory overhead 110
Fixed production costs:
Depreciation (equipment) 70
Factory rent 98
Other 22
Total production cost $ 670
Variable selling & administrative costs $ 34 per unit
Fixed selling & administrative costs $ 46 per unit

Given a normal selling price per unit of $800, what is the contribution margin per unit sold for recurring (i.e., normal) sales?

Multiple Choice

  • $486.

  • $466.

  • $426.

  • $286.

  • $630.

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