_____ is all variable costs divided by sales.
A)Gross margin
B)Contribution-margin ratio
C)Variable-cost ratio
D)The sales mix

Question

Quizplus · Accepted Answer

The variable-cost ratio is calculated by dividing all variable costs by sales. This ratio helps a business owner to analyze how much of their sales revenue is being consumed by variable costs (costs that vary with the level of sales, such as direct materials, direct labor, and variable overhead). By knowing this ratio, a business owner can determine their break-even point and can make informed decisions about pricing, cost management, and other strategic decisions.

_____ Is All Variable Costs Divided by Sales