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Computation of contribution per unit for various models.
Person Company makes two types of backpacks. Data for the company's activity during a typical month are presented below:
School Model
Hiker Model
Sales Unit
$40,000
Selling price per unit
$6
$18
Variable expense per unit
$2
$10
The company's total fixed expenses are $80,000. There are no beginnings or ending inventories. Required:
What is the per unit contribution margin for each of the two models?
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