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    Selling Price

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    Please help with the following problem involving selling price and required contribution margins.

    Anna & Anna Corporation is a small table manufacturing company operating in the north of Puerto Rico. Managers estimate the following costs per unit (one table)

    Direct material (DM) $45.00
    Direct labor (DL) $20.00
    Variable manufacturing overhead(VMO) $24.00
    Variable administrative expenses (VAE) $25.00
    Monthly fixed costs are
    Manufacturing $12,000.00
    Administrative $10,000.00
    The estimated contribution margin is 40%

    Find the selling price per unit to achieve the required contribution margin of 35%.

    © BrainMass Inc. brainmass.com June 3, 2020, 10:41 pm ad1c9bdddf
    https://brainmass.com/business/bond-valuation/selling-price-and-required-contribution-margins-243867

    Solution Preview

    Problem: Anna & Anna Corporation is a small table manufacturing company operating in the north of Puerto Rico. Managers estimate the following costs per unit (one table). Find the ...

    Solution Summary

    The solution explains how to calculate the selling price per unit so as to achieve the required contribution margin of 35%. Concepts covered include direct material, direct labor, variable manufacturing overhead, variable administrative expenses.

    $2.19

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