Question: Leon s Ties makes three different styles o f ties for men. They estimated the long i s 1 0 % o f sales with

Leons Ties makes three different styles of ties for men. They estimated the long is10%of sales with a contribution margin per unit of $1. The medium is50%of sales with a contribution margin of $2.50 per unit, and the short is40%of sales with a contribution margin of $2.25 per unit. If Leons Ties sells 2,500 units, but the composition changes to50% long, 25% medium and 25% short, how would this change the WACM per unit?
Select answer from the options below
The WACM per unit would be higher since more sales are the product with the lower CM.
The WACM per unit would be lower since more sales are the product with a higher CM.
The WACM per unit would be lower since more sales are the product with a lower CM.
The WACM per unit would be higher since more sales are the product with a higher CM.

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Accounting Questions!