What Is Controllable Margin

question 32

Multiple Choice

What is controllable margin?

• A)contribution margin less controllable fixed costs
• B)sales minus variable costs
• C)sales minus contribution margin
• D)contribution margin less all fixed costs

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Definitions:

Fixed Manufacturing Overhead

The portion of manufacturing costs that do not vary with the level of production, such as salaries of supervisors and rent for factory buildings.

Variable Costing

A costing method that includes only variable production costs in the cost of goods sold, excluding fixed manufacturing overhead.

Absorption Costing

A method of product costing that captures all costs associated with manufacturing a product, including overhead expenses.

Variable Production Costs

Variable production costs fluctuate with the level of production output and include expenses like raw materials and labor directly tied to the production process.