A segment margin is the operating income generated by a profit or investment center before subtracting common allocated fixed costs to the center.

Name: A segment margin is the operating income generated by a profit or investment center before subtracting common allocated fixed costs to the center.
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Question

Quizplus · Accepted Answer

This is the correct definition of segment margin. It excludes common allocated fixed costs to the center to give a clearer picture of the center's profitability.

A Segment Margin Is the Operating Income Generated by a Profit