CAF-5 · Chapter 9 · Question 7 of 10
In a marginal costing income statement, what is deducted from Sales Revenue to arrive at the "Contribution Margin"?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) All variable costs (including production, selling, and administration)
Explanation
In a standard marginal costing format, Contribution Margin is derived by subtracting all variable costs (both manufacturing variable costs and non-manufacturing variable selling/admin costs) from the sales revenue.
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