What Is the Equivalent of Gross Margin on a Variable

question 86

Multiple Choice

What is the equivalent of gross margin on a variable costing income statement?

• A)gross profit
• B)contribution margin
• C)net income
• D)territory margin

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Definitions:

Operating Cash Flow

Cash generated from a company's normal business operations, indicating its ability to generate sufficient positive cash flow to maintain and grow operations.

Net Working Capital

The difference between a company's current assets and its current liabilities, indicating its short-term financial health and efficiency.

Cash Expenses

Payments that a business makes in cash, including operating expenses, purchasing of goods, and other transactions.

Depreciation Expense

The allocation of the cost of a tangible asset over its useful life, reflecting wear and tear, deterioration, or obsolescence.