In a profit-volume graph, the slope of the profit line represents
A)the selling price per unit.
B)the contribution margin per unit.
C)the variable cost per unit.
D)total contribution margin.

Question

Quizplus · Accepted Answer

The slope of the profit line represents the contribution margin per unit, which is the amount of revenue remaining after deducting variable costs. This is because the slope represents the change in profit as a result of a change in the number of units sold, and the contribution margin per unit is the amount of profit that each unit contributes towards covering fixed costs and generating a profit. Therefore, the correct choice is B.

In a Profit-Volume Graph, the Slope of the Profit Line