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Determining variable cost from incomplete cost data
Thornton Corporation produced 212,000 watches that it sold for $20 each during year 2. The company determined that fixed manufacturing cost per unit was $7 per watch.
The company reported a $1,484,000 gross margin on its year 2 financial statements.
Required
Determine the variable cost per unit, the total variable cost, and the total contribution margin.
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The market value today of the current machine is $50,000. Your? company's tax rate is 40%?, and the opportunity cost of capital.
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