The contribution margin per unit is divided by selling price to calculate ____________?
Correct answer: B. contribution margin percentage
- A. fixed margin percentage
- B. contribution margin percentage
- C. variable margin percentage
- D. breakeven margin percentage
Explanation
Dividing contribution margin per unit by selling price gives the contribution margin percentage, also called the contribution margin ratio. Thus, option b is correct.
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About Cost Accounting
Cost accounting measures and analyses the cost of producing goods or providing services for planning, control and pricing decisions. It covers direct and indirect costs, fixed and variable costs, job and process costing, break-even analysis, marginal costing, overhead allocation, and the difference between product cost and period cost.
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