Segment margin is sales minus:
A)variable expenses.
B)traceable fixed expenses.
C)variable expenses and common fixed expenses.
D)variable expenses and traceable fixed expenses.

Question

Quizplus · Accepted Answer

Segment margin is the contribution to profit of a particular segment of a business, which is equal to the segment's sales revenue minus its variable expenses and traceable fixed expenses. Option A is incorrect as it only considers variable expenses, and option B is incorrect as it only considers traceable fixed expenses. Option C includes common fixed expenses, which are not subtracted from segment margin. Therefore, the correct answer is option D.

Segment Margin Is Sales Minus