East Company manufactures and sells a single product with a positive contribution margin. If the…

East Company manufactures and sells a single product with a positive contribution  margin. If the selling price and the variable expense per unit both increase 5% and  fixed expenses do not change, what is the effect on the contribution margin per unit and the contribution margin ratio?

 

Contribution

Contribution

 

margin per unit

margin ratio

A)

No change

No change

B)

Increase

Increase

C)

Increase

No change

D)

Increase

Decrease

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