Which of the following costs would be subtracted from Revenue to calculate Contribution Margin on a Variable Income Statement?
A) Direct Materials costs
B) Sales salaries
C) Fixed Manufacturing Overhead
D) All of the above

Question

Quizplus · Accepted Answer

Contribution Margin is calculated by subtracting variable costs, such as Direct Materials costs, from Revenue. Fixed costs like Sales salaries and Fixed Manufacturing Overhead are not subtracted when calculating Contribution Margin.

Which of the Following Costs Would Be Subtracted from Revenue