In Using the Contribution Margin Technique

question 76

Multiple Choice

In using the contribution margin technique

• A)a target profit is added to variable costs.
• B)a target profit is added to fixed costs.
• C)fixed costs must always be shown separate from other costs and the target.
• D)the target profit should be shown after the break-even analysis indicates zero profit or loss.

---

Definitions:

Perceptual Set

A mental predisposition to perceive one thing and not another, influenced by expectations, emotions, culture, and previous experiences.

Ponzo Illusion

A visual illusion where two horizontal lines of identical length appear to be of different lengths because of converging parallel lines.

Basal Metabolic Rate

The rate at which the body uses energy while at rest to maintain vital functions such as breathing and keeping warm.

Set Point

A theory suggesting that an individual's body weight is maintained around a biologically determined point, with the body regulating metabolism to maintain weight around this point.