Gross margin in a merchandising organization is considered to be
A)the same as the contribution margin.
B)all revenues less costs which do not change with respect to an output-related driver.
C)all revenues less cost of goods sold.
D)all revenues plus costs which change with respect to an output-related driver.
E)all revenues.

Question

Quizplus · Accepted Answer

Gross margin in a merchandising organization is calculated as the difference between the revenues generated from the sale of goods and the cost of goods sold. It represents the amount of money that is available to cover operating expenses and generate profit. Hence, the correct option is C, which states that gross margin is all revenues less cost of goods sold.

Gross Margin in a Merchandising Organization Is Considered to Be