In: Accounting
CALCULATION OF CONTRIBUTION MARGIN PER UNIT | |||
PARTICULARS | Product | ||
Selling Price Per Ticket | 60 | Pounds | |
Less: Variable Cost | 20 | Pounds | |
Contribution Margin per unit | 40 | Pounds | |
Target Profit = ( Fixed Cost + target Income ) / Contribution Margin per unit | |||
Target Profit = | |||
Fixed Cost (1600 +1210) | 2,810 | Pounds | |
Add: | "+ " | ||
Target Income = | 2,390 | Pounds | |
Equal to = | 5,200 | ||
Divide By | "/"By | ||
Contribution marrgin per unit | 40 | ||
Equal to = | 130 | Tickets | |
Answer = To make profit of 2390 Pounds tickets need to sold = 130 Tickets | |||