General accounting NDB Company has a factory with fixed costs of $500,000 anda production capacity of 150,000 units annually. Its productsells with a 30% contribution margin. The target profit is$300,000. At full production, what does the selling price perunit need to be? Show your complete solution.

Step 1: Define Contribution MarginThe contribution margin is the surplus of the selling price over…

Answered: NDB Company has a factory with fixed…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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NDB Company has a factory with fixed costs of $500,000 and a production capacity of 150,000 units annually. Its product sells with a 30% contribution margin. The target profit is $300,000. At full production, what does the selling price per unit need to be? Show your complete solution.