Question

The contribution margin income statement presents​ ________ above the contribution margin line.
A. all variable expenses
B. all fixed expenses
C. only fixed expenses relating to selling and administrative activities
D. only variable expenses relating to selling and administrative activities

Answer 1

Answer:

A. all variable expenses

Explanation:

Contribution margin: It is a margin which shows a difference between the sales revenue and the all variable cost/ expenses.

In mathematically,

Contribution margin = Sales revenue - variable expenses

It is computed by considering both the things i.e sales revenue and the variable expenses

And, if we want to compute the net income, So we use fixed expenses

Net income =  Contribution margin - Fixed expenses