Carr Company Produces a Single Product

question 62

Multiple Choice

Carr Company produces a single product. During the past year, Carr manufactured 25,000 units and sold 20,000 units. Production costs for the year were as follows:
-The contribution margin per unit would be:

• A)$12.10
• B)$22.10
• C)$17.70
• D)$16.60

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Definitions:

Profit Centre

A segment of a business that is responsible for both generating revenue and controlling costs, thereby directly influencing its own profitability.

Residual Income

Earnings generated beyond the minimum rate of return expected by a company or its investors, often used as a performance measure.

Gross Margin

The difference between sales revenue and the cost of goods sold, expressed as a percentage.

Average Operating Assets

The average value of assets used in the company's operations, calculated over a specific period to assess asset utilization efficiency.