Which of the Following Statements Regarding the Contribution Margin Ratio

question 37

Multiple Choice

Which of the following statements regarding the contribution margin ratio is not true?

• A)The contribution margin ratio is equal to the contribution margin per unit divided by the selling price per unit.
• B)The contribution margin ratio is the amount of each sales dollar that goes toward covering fixed costs and generating a profit.
• C)The contribution margin ratio is equal to variable cost per unit divided by fixed cost per unit.
• D)The contribution margin ratio is useful when companies that sell a variety of products calculate a break-even point in sales.