The contribution margin per unit is multiplied to number of units sold to calculate _____________?
Correct answer: C. contribution margin
- A. revenue margin
- B. variable margin
- C. contribution margin
- D. divisor margin
Explanation
Contribution margin per unit multiplied by units sold gives total contribution margin. This total is available to cover fixed costs and generate operating income.
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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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