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Michonne Currently Manages a Private Cloud That Has Been Built

question 18

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Michonne currently manages a private cloud that has been built out in an on-premises data center. Some of the servers are reaching the end of their life and she has been tasked with finding a solution that minimizes the amount of capital investment necessary. Which of the following might she choose to implement for her company?


Definitions:

Contribution Margin

The amount remaining from sales revenues after all variable expenses have been deducted.

Segment Margin

The amount of profit or loss generated by a particular segment of a business, considering only the revenues and costs directly attributable to the segment.

Absorption Costing

A financial recording technique that incorporates all expenses related to production, such as direct materials, direct labor, and variable as well as fixed manufacturing overhead costs, into the product's cost.

Unit Product Cost

The total cost (direct materials, direct labor, and overhead) assigned to a single unit of product.

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