Match the definitions on the left with the most appropriate term on the right. Terms may be used once, more than once, or not atall.

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Description Terms 1. Buffer zone that identifies how A. Weighted-average contribution margin B. Margin of safety C. Product mix D. Cost structure E. Indifference point F Total contribution margin G. Target sales revenue H. Degree of operating leverage I. Automation J. Target units much sales can drop before the business suffers a loss. Increases the break-even point because fixed costs are higher, but each unit adds more profit because of the lower variable cost per unit. 2. 3. Total Fixed Costs Target Profit Contribution Margin Ratio How a company uses variable costs versus fixed costs to perfor operations The extent to which fixed costs are used to operate the business 4. m its 5. 6. 7. 8. When two profit equations yield the same profit Actual or budgeted sales minus break-even sales Total fixed costs plus target profit. Contribution Margin Net Operating Income 10. Total Fixed Costs+ Target Profit Unit Contribution Margin