Contribution margin ratio can be calculated in all of the following ways except
A) fixed costs / Contribution margin per unit.
B) 1 − Variable cost ratio.
C) contribution margin per unit / price.
D) total contribution margin / Total sales.
E) All of these are correct.

Question

Quizplus · Accepted Answer

The contribution margin ratio is calculated as (Contribution Margin per Unit / Price) or (Total Contribution Margin / Total Sales) or (1 - Variable Cost Ratio). It is not calculated as (Fixed Costs / Contribution Margin per Unit), making option A incorrect.

Contribution Margin Ratio Can Be Calculated in All of the Following