In contribution margin analysis,the increase or decrease in unit sales price or unit cost on the number of units sold is referred to as the:
A) sales factor
B) cost of goods sold factor
C) quantity factor
D) unit price or unit cost factor

Question

Quizplus · Accepted Answer

The increase or decrease in unit sales price or unit cost on the number of units sold is referred to as the unit price or unit cost factor. This factor directly affects the contribution margin, which is the difference between the unit sales price and the unit variable cost. Any change in the unit price or unit cost will impact the contribution margin, and hence, it is an important factor to consider in contribution margin analysis.

In Contribution Margin Analysis,the Increase or Decrease in Unit Sales