Mccoy brothers manufactures and sells two products, a and z in the ratio of 5: 2.
product a sells for $87; z sells for $108.
variable costs for product a are $46; for z $53.
fixed costs are $430,500.

compute the contribution margin per composite unit.

a)$205.

b)$305.

c)$287.

d)$315.

e)$336.

Option (d) is correct.

Explanation:

Contribution margin per unit for Product A:

= Selling price - variable cost

= $87 - $46

= $41

Contribution margin per unit for Product Z:

= Selling price - variable cost

= $108 - $53

= $55

contribution margin per composite unit:

= (Contribution margin per unit for Product A × 5) + (Contribution margin per unit for Product Z × 2)

= ($41 × 5) + ($55 × 2)

= $205 + $110

= $315

answer; (a) conduct a worksite inspection;