FNSACC412 Prepare Operational Budgets - Flexible Budgets

Topic 7 - Activities

Question 20

Firm Y has forecast two levels of production : (i) 2,000 and (ii) 3,000 units. If variable costs are $18 per unit and the selling price is $40 per unit, what is the contribution margin for each level of production?

1. (i) $116,000 and (ii) $174,000
2. (i) $66,000 and (ii) $44,000
3. (i) $900 and (ii) $1,350
4. (i) $44,000 and (ii) $66,000

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