Answer:
Weighted average contribution margin= (weighted average selling price - weighted average unitary variable cost)
Explanation:
Sales proportion:
Large fries= 5/9= 0.56
Small fries= 4/9= 0.44
A small fry sells for $2.00 with a variable cost of $0.25.
We need to complete the information to calculate the weighted average contribution margin:
For example= A large fry sells for $2.9 with a variable cost of $0.4
To calculate the weighted-average contribution margin, we need to use the following formula:
Weighted average contribution margin= (weighted average selling price - weighted average unitary variable cost)
Weighted average contribution margin= (0.56*2.9 + 0.44*2) - (0.56*0.4 + 0.44*0.25)
Weighted average contribution margin= 2.504 - 0.334
Weighted average contribution margin= $2.17
