Question

Contribution margin is always the same as gross profit margin. is calculated by subtracting total manufacturing costs per unit from sales revenue per unit. excludes variable selling costs from its calculation. equals sales revenue minus variable costs_________

Answer 1

Answer: equals sales revenue minus variable costs

           

Explanation: In simple words, contribution margin refers to the amount of revenue that an organisation is left with after paying for the variable expenses that are incurred for the generation of such revenue.  

It is an important aspect of an organisation as it somehow depicts the ability of it to pay its fixed expenses like interests etc.