The management of Caribbean Juices has provided you with the following data on its Creamy Brand juice mix. Sales revenue $600,000 Unit selling price $10 Contribution margin ratio 40% Fixed cost $200,000 What is the unit variable cost? a. $0.40 b. $4 c. $0.60 d. $6
Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
The management of Caribbean Juices has provided you with the following data on its Creamy Brand juice mix.
Sales revenue $600,000
Unit selling price $10
Contribution margin ratio 40%
Fixed cost $200,000What is the unit variable cost?
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