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02-07-2020
Business

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Crane Company produces two models: Model 24 has sales of 300 units with a contribution margin of $40 each; Model 26 has sales of 150 units with a contribution margin of $50 each. If sales of Model 26 increase by 50 units, how much will profit change

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02-07-2020

Answer:

Effect on income= 50*50= $2,500 increase

Explanation:

Giving the following information:

Model 26 has sales of 150 units with a contribution margin of $50 each.

To calculate the effect on income, we need to use the following formula:

Effect on income= number of units*unitary contribution margin

Effect on income= 50*50= $2,500 increase

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