In cost-volume-profit analysis, the unit contribution margin is:
A) Sales price per unit less cost of goods sold per unit.
B) Sales price per unit less unit fixed cost per unit.
C) Sales price per unit less total variable cost per unit.
D) Sales price per unit less unit total cost per unit.
E) The same as the contribution margin ratio.

Question

Quizplus · Accepted Answer

The unit contribution margin is the sales price per unit minus the total variable cost per unit. This is because the unit contribution margin represents the amount of revenue that is available to cover fixed costs and provide a profit after all variable costs have been covered. Therefore, option C is the best choice as it directly defines the calculation for unit contribution margin.

In Cost-Volume-Profit Analysis, the Unit Contribution Margin Is