Given the below data how would you calculate the marginal cost, marginal revenue, contribution margin %, and other critical ratios/calculations to determine pricing for adding additional customers? Is there missing data needed?
Garbage company deciding to pickup additional dumpsters measured by yards. Below is financials on current customers. Need to calculate a price per yard for adding 800 additional yards.
Revenue per yard = $6.66
Disposal per yard (expense) = $1.52
Net revenue per yard = $5.14
Op cost per yard = $2.62
Margin = $2.52
Margin % = 37.9%
Gross revenue = $9,989,548
Gross disposal cost = $2,260,105
Total yards collected = 1,490,243
Cost per driver hour = $151
Cost per route = $32,058
Sample Solution
