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Nesha Grubbs
on Nov 17, 2024

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In the variable costing income statement, deduction of variable selling and administrative expenses from manufacturing margin yields

A) differential margin
B) contribution margin
C) gross profit
D) marginal expenses

Variable Costing

An accounting method that includes only variable production costs in the cost of goods sold and treats fixed costs as period costs.

Contribution Margin

The difference between sales revenue and variable costs, indicating how much revenue contributes to covering fixed costs and generating profit.

Manufacturing Margin

The difference between the cost of goods sold by a manufacturing company and its total sales, reflecting the gross margin specific to manufacturing operations.

  • Understand the concept of manufacturing margin and contribution margin in variable costing.
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Ahsan HabibNov 21, 2024
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