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24 December, 11:16

Seascape Company has two products: Product A has a contribution margin per unit of $17 and Product B has a contribution margin of $19 per unit. Calculate the weighted-average unit contribution margin if Seascape has a 40/60 product mix. (Round your answer to 2 decimal places.)

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  1. 24 December, 12:53
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    weighted average contribution margin = $18.2

    Explanation:

    Giving the following information:

    Product A has a contribution margin per unit of $17 and Product B has a contribution margin of $19 per unit. Seascape has a 40/60 product mix.

    To calculate the weighted average contribution margin, we need to use the following formula:

    weighted average contribution margin = contribution margin Product A * proportion of sales + contribution margin Product B * proportion of sales

    weighted average contribution margin = 17*0.4 + 19*0.6 = $18.2
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