
Concept explainers
Contribution margin and operating income Under Variable costing:
The Contribution margin is the excess of sales revenue over variable cost of goods sold (i.e. variable product cost and variable period cost). The contribution margin refers to the amount which contributes towards the fixed cost and operating income of the business.
Under variable costing, the income statement is prepared based on the fact that only variable
The Contribution margin and operating income to be computed.

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Chapter 21 Solutions
Horngren's Accounting, The Financial Chapters (11th Edition) - Standalone Book
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