Question 1. Calculate the contribution margin rate for each product.
Question 2. Calculate the weighted average contribution margin (WACM) rate for all five products.
Target Profit is $35,000
| Product |
Retail Selling Price/yard |
Wholesale Selling Price/yard |
Variable Cost/yard |
Expected Sales Breakdown ($) |
| Green |
$18.00 |
$13.00 |
$11.00 |
10% |
| Blue |
$12.50 |
$10.00 |
$4.00 |
5% |
| Yellow |
$19.00 |
$12.00 |
$8.50 |
40% |
| Black |
$22.00 |
$17.00 |
$11.75 |
10% |
| Red |
$32.00 |
$27.00 |
$18.00 |
35% |