The Goldfarb Company manufactures and sells toasters. Each toaster sells for $23.75 and the variable cost per unit is $16.25. Goldfarb's total fixed costs are $25,000, and budgeted sales are 8,000 units. What is the contribution margin per unit?
A) $7.50.
B) $16.25.
C) $23.75.
D) $60,000.
E) $1.25.
A) $7.50.
Explanation: Contribution margin per unit = $23.75 - $16.25 = $7.50
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