Contribution margin is
A) the excess of sales revenue over variable cost
B) another term for volume in the "cost-volume-profit" analysis
C) profit
D) the same as sales revenue

Question

Quizplus · Accepted Answer

Contribution margin is calculated by subtracting variable costs from sales revenue. It represents the amount of revenue that is available to cover fixed costs and contribute to profits. Therefore, the correct option is A.

Contribution Margin Is