A customer service department has the following resolution response time data: Average Response Time First contact 0.25 hr. Serv
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Answer:
The contribution margin ratio can be calculated using either total amounts or per unit amounts.
Explanation:
Contribution margin ratio =
This can even be done by
This will calculate contribution as a percentage of Sales, with this margin ratio we get break even sales value, and not the units.
Whenever there is an increase in variable cost it decreases the contribution.
Therefore, correct statement is
The contribution margin ratio can be calculated using either total amounts or per unit amounts.