Amazon.com announced in a May 19, 2011, news release that the company was selling more Kindle books
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a. What is Amazon.com’s sales mix of Kindle ebooks to print books?
b. How do you think the contribution margin on a Kindle ebook compares to the contribution margin of a print book?
c. As Amazon.com’s sales mix approaches the 2 to 1 sales mix of Kindle ebooks to print books at Amazon.co.uk, what will likely happen to the breakeven point?
Contribution Margin
Contribution margin is an important element of cost volume profit analysis that managers carry out to assess the maximum number of units that are required to be at the breakeven point. Contribution margin is the profit before fixed cost and taxes...
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