(Appendix 5A)Which of the following best describes a cost object,such as a product or customer,that has a negative green margin?
A) Its yellow margin will be positive.
B) Its yellow margin may be either positive or negative.
C) Its yellow margin will be negative.
D) Its yellow margin will be zero.

Question

Quizplus · Accepted Answer

A negative green margin means that the cost of producing the product or serving the customer exceeds the revenue earned from it. Therefore, the yellow margin (which represents the contribution margin) will also be negative as it is calculated by subtracting the variable costs from the revenue.

(Appendix 5A)Which of the Following Best Describes a Cost Object,such