CONTRIBUTION MARGIN PER UNIT Definition

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CONTRIBUTION MARGIN PER UNIT, also known as dollar contribution margin per unit, is the selling price per unit minus the variable cost per unit. The "contribution" represents that portion of sales revenue that is not consumed by variable cost, thereby contributing to the coverage of fixed cost.

 

Learn new Accounting Terms

PROFITABILITY is companys ability to generate revenues in excess of the costs incurred in producing those revenues.

INCOME TAX is a tax paid on money made or profit realized from employment, business, or capital.

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