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The two planes are parallel.
Plane 1:
Plane 2:
Contribution Margin
The difference between sales revenue and variable costs, indicating how much revenue contributes to covering fixed costs and generating profit.
Fixed Costs
Costs that do not vary with production or sales levels, including rent, insurance, and salaries, which remain constant regardless of business activity levels.
Operating Income
The profit realized from a business's operations, calculated by subtracting operating expenses from gross profit.
Fixed Costs
Expenses that do not change in proportion to the activity of a business, such as rent, salaries, and insurance premiums.
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