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5 October, 18:27

The Sand Cruiser is a takeout food store at a popular beachside resort. Teresa Texton, owner of the Sand Cruiser, was deciding how much refrigerator space to devote to four different beverages. Appropriate data on the four beverages follow:Limeade Lemonade Ginger Ale Grape JuiceSales price per case $22.10 $21.00 $22.10 $46.30Variable cost per case 15.90 18.10 15.90 35.50Cases sold per foot of shelf space per day 28 22 6 4The contribution per foot of shelf space per day for Limeade is:

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  1. 5 October, 19:20
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    Answer: $6.2

    Explanation: Contribution margin is the amount of revenue left after paying for the variable cost, it can be formulated as follows : -

    contribution = sales - variable cost

    In case of Limeade:-

    sale price = $22.10

    Variable cost = $15.90

    so, putting the values into equation we get : -

    contribution per foot = $22.10 - $15.9 = $6.2
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