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Sheridan Company sells two types of computer hard drives. The sales mix is 30% (Q-Drive) and...

Sheridan Company sells two types of computer hard drives. The sales mix is 30% (Q-Drive) and 70% (Q-Drive Plus). Q-Drive has variable costs per unit of $45 and a selling price of $105. Q-Drive Plus has variable costs per unit of $60 and a selling price of $150. The weighted-average unit contribution margin for Sheridan is

$105.

$69.

$81.

$53.

Guys, please try to explain it a little bit! thanksss

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Answer #1
Q Drive Q Drive Plus
Selling price per unit 105 150
Variable cost per unit 45 60
Contribution margin per unit 60 90
Sales mix 30% 70%

Weighted average unit contribution margin = Contribution margin of Q Drive x Sales mix percentage + Contribution margin of Q Drive plus x Sales mix percentage

= 60 x 30% + 90 x 70%

= 18+63

= $81

Third option is correct option.

Kindly comment if you need further assistance.

Thanks‼!

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