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22 May, 12:25

Crane Company produces two models: Model 24 has sales of 300 units with a contribution margin of $40 each; Model 26 has sales of 150 units with a contribution margin of $50 each. If sales of Model 26 increase by 50 units, how much will profit change

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  1. 22 May, 15:20
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    Effect on income = 50*50 = $2,500 increase

    Explanation:

    Giving the following information:

    Model 26 has sales of 150 units with a contribution margin of $50 each.

    To calculate the effect on income, we need to use the following formula:

    Effect on income = number of units*unitary contribution margin

    Effect on income = 50*50 = $2,500 increase
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Home » Business » Crane Company produces two models: Model 24 has sales of 300 units with a contribution margin of $40 each; Model 26 has sales of 150 units with a contribution margin of $50 each. If sales of Model 26 increase by 50 units, how much will profit change
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