The revenues are subtracted from the cost of direct materials of sold goods is to calculate _________?
Correct answer: B. throughput contribution
- A. operating cost contribution
- B. throughput contribution
- C. operating contribution
- D. marginal contribution
Explanation
Throughput contribution equals sales revenue minus the direct material cost of goods sold, because direct materials are treated as the principal variable cost. The other contribution terms do not use this standard formula.
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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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