Which of the following changes would normally increase the contribution margin per unit the most?
A) A 20% decrease in fixed costs.
B) A 25% increase in the variable cost per unit.
C) A 25% increase in the sales price per unit.
D) A 25% decrease in the variable cost per unit?

Question

Quizplus · Accepted Answer

A 25% increase in the sales price per unit directly increases the contribution margin per unit by increasing the difference between the sales price and the variable cost per unit, without affecting the variable costs.

Which of the Following Changes Would Normally Increase the Contribution