Palmer's Plant Food Company Sells Two Products,Quo-Eco and Quo-Pre,with a Sales

question 24

Essay

Palmer's Plant Food Company sells two products,Quo-Eco and Quo-Pre,with a sales mix of 65% and 35%,respectively.Quo-Eco has a contribution margin per unit of $10,and Quo-Pre has a contribution margin per unit of $15.The company sold 1,000 total units in March.
Requirements:
a)Calculate the total contribution margin for the company.
b)Assume the sales mix shifted to 50% for each product,and calculate the total contribution margin for the company.

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Definitions:

Cold Front

A leading edge of a cooler mass of air, replacing (at ground level) a warmer mass of air, which can lead to dramatic changes in weather conditions.

Rain Shadow Effect

A climatic phenomenon where a mountain range causes precipitation on one side, creating a dry area on the leeward side due to the blocking of rain-producing weather systems.

Tornadoes

are violently rotating columns of air that are in contact with both the surface of the Earth and a cumulonimbus cloud or, in rare cases, the base of a cumulus cloud, known for causing significant destruction.

Per Annum

A Latin term meaning "per year," used to describe a rate or amount measured over the course of a year.