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formula for weighted average contribution margin. The calculation procedure and the formulas are discussed via following example. We can calculate the total sales weighted average contribution margin and the break-even point per unit or sales as below.
Weighted Average Cost Of Capital Wacc The Firm S Overall Cost Of Capital Considering All Of The Components Of The Cost Of Capital Financial Analyst Finance from www.pinterest.com
Contribution Margin per Unit is calculated using the formula given below Contribution Margin per Unit Sales Price per Unit Total Variable Cost per Unit Contribution. We can calculate the total sales weighted average contribution margin and the break-even point per unit or sales as below. CM SP N VC N Where CM is the contribution margin.
An example would be very helpful to understand the whole procedure.
Aggregate sales - Aggregate variable expenses Number of units sold Weighted average. These are then used to calculate the break-even point for sales mix. Margin 2 000 000 - 1 000 000 1 000 000 ContributionMargin 20000001000000 1000000. CM SP N VC N Where CM is the contribution margin.
