It Is Critical for Management to Understand Its Overall Sales

question 59

Multiple Choice

It is critical for management to understand its overall sales mix when using contribution margin income statements because

• A)variable cost allocations between products may be difficult to determine.
• B)fixed cost allocations between products may be difficult to determine.
• C)overhead allocation must be spread evenly across all product lines.
• D)different products can have widely differing contribution margins even with the same level of sales.