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formula for weighted average contribution margin. We can calculate the total sales weighted average contribution margin and the break-even point per unit or sales as below. For example with 209000 total contribution margin and 10000 products 6000 pairs of sandals 4000 pairs of shoes your weighted average contribution margin will.
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This problem is overcome by calculating weighted average contribution margin per unit and contribution margin ratio. The weighted average contribution margin is determined by multiplying the products contribution margin by its sales mix. Variable expenses are those costs that.
Calculate the Weighted Average Contribution Margin To calculate the WACM all you need to do is add the unit sales for each product line into one large total.
Weighted average unit contribution margin Contribution A x Sales mix A Contribution B x Sales mix B. Contribution Margin per Unit is calculated using the formula given below Contribution Margin per Unit Sales Price per Unit Total Variable Cost per Unit Contribution. An example would be very helpful to understand the whole procedure. The calculation procedure and the formulas are discussed via following example.
