Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Given the information, what is significant concerning the contribution margins of Products A & B ? Please select one answer choice. Product A Product B

Given the information, what is significant concerning the contribution margins of Products A & B? Please select one answer choice.
Product A Product B
Price per Unit $30 $28
Valuable Cost/Unit $18 $22
Fixed cost $35,000 $18,000
A) A lower contribution margin is better for capital intensive businesses than labor intensive business.
B) A higher contribution margin and total contribution margin can help a business meet its break-even point faster and with less units needed to break- even
C) Companies with higher contribution margins are more likely to be more efficient than those with lower contribution margins.
D) Companies with a high fixed cost structure always have high contributions margins than those with labor intensive businesses.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Horngrens Financial & Managerial Accounting

Authors: Tracie Miller Nobles, Brenda Mattison

7th Edition

0136516254, 9780136516255

More Books

Students also viewed these Accounting questions