Manchester Airlines is in the process of preparing a contribution margin income statement that will allow a detailed look at its variable costs and profitability of operations. Which of the following cost combinations should be used to evaluate the variable cost per flight of the company's Boston-Las Vegas flights?
A) Flight crew salary, fuel, and engine maintenance.
B) Fuel, food service, and airport landing fees.
C) Airplane depreciation, baggage handling, and airline marketing.
D) Communication system operation, food service, and ramp personnel.

Question

Quizplus · Accepted Answer

The variable costs per flight would include fuel, food service, and landing fees. Other costs mentioned such as salaries, depreciation, marketing, and communications would not vary with individual flights.

Manchester Airlines Is in the Process of Preparing a Contribution