"Contribution margin per unit" is best described by which of the following?
A)Sales price per unit minus fixed cost per unit
B)Sales price per unit minus variable cost unit
C)Sales price per unit minus fixed and variable costs per unit
D)Units sold time contribution margin ratio

Question

Quizplus · Accepted Answer

Contribution margin per unit is the amount by which a product's selling price exceeds its variable costs per unit. Therefore, it is calculated as sales price per unit minus variable costs per unit. Option B reflects this definition. Option A only considers fixed costs, while option C subtracts both fixed and variable costs, which is incorrect. Option D is related to contribution margin ratio, not contribution margin per unit.

"Contribution Margin Per Unit" Is Best Described by Which of the Following