Eley corporation produces a single product. the cost of producing and selling a single unit of this product at the company's normal activity level of 40,000 units per month is as follows: direct materials $ 43.8direct labor $ 10.4variable manufacturing overhead $ 1.9fixed manufacturing overhead $ 26.0variable selling & administrative expense $ 2.4fixed selling & administrative expense $ 13.8the normal selling price of the product is $104.4 per unit. an order has been received from an overseas customer for 1,650 units to be delivered this month at a special discounted price. this order would not change the total amount of the company's fixed costs. the variable selling and administrative expense would be $1.8 less per unit on this order than on normal sales. direct labor is a variable cost in this company. what is the contribution margin per unit on normal sales?

Contribution margin per unit = $45.90

Contribution margin as sales percentage = 43.97%

Explanation:

As for the information provided we have,

Normal Sales = Normal sales per month, before the overseas order.

For such normal sales, the cost and sales data has been provided,

Selling price per unit = $104.40

Variable costs = Direct material + Direct Labor + Variable Manufacturing + Variable selling & Administrative

= $43.80 + $10.40 + $1.90 + $2.40 = $58.50

Contribution margin per unit = Selling price - Variable cost per unit = $104.40 - $58.50 = $45.90

Contribution margin as sales percentage = 43.97%

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