A jeans maker is designing a new line of jeans called Slams. Slams will sell for $360 per unit and cost $262.80 per unit in variable costs to make. Fixed costs total $63,500.

 Exercise 5-7 (Algo) Contribution margin LO A1

A jeans maker is designing a new line of jeans called Slams. Slams will sell for $360 per unit and cost $262.80 per unit in variable costs to make. Fixed costs total $63,500. (Round your answers to 2 decimal places.)

 

Explanation

3. If 5,700 units are sold: Income = (5,700 × $97.20) − $63,500 = $490,540.
 

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