The contribution margin is the amount that contributes toward recovering fixed costs and earning a profit.

Name: The contribution margin is the amount that contributes toward recovering fixed costs and earning a profit.
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Question

Quizplus · Accepted Answer

The contribution margin is calculated by subtracting variable costs from revenue. This amount can then be used to first cover fixed costs and then contribute to profit. Therefore, the contribution margin does indeed contribute toward recovering fixed costs and earning a profit.

The Contribution Margin Is the Amount That Contributes Toward Recovering