If the contribution margin per unit is $1000 and the contribution margin percentage is 25%, then the selling price would be ____________?
Correct answer: B. $4,000
- A. $2,500
- B. $4,000
- C. $3,800
- D. $3,800
Explanation
Selling price is contribution margin per unit divided by the contribution margin percentage: $1,000 ÷ 0.25 = $4,000. Options c and d are duplicate distractors, but neither equals the calculated amount.
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About Cost Accounting
Cost accounting measures and analyses the cost of producing goods or providing services for planning, control and pricing decisions. It covers direct and indirect costs, fixed and variable costs, job and process costing, break-even analysis, marginal costing, overhead allocation, and the difference between product cost and period cost.
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