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Which of the Following Formulae Is the Right Formula for Calculating

question 89

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Which of the following formulae is the right formula for calculating contribution margin ratio?


Definitions:

Periodic Inventory System

An accounting method where inventory is physically counted at specific intervals, typically at the end of an accounting period, to determine the cost of goods sold and ending inventory.

Perpetual Inventory System

An inventory accounting method where transactions are recorded on the spot with the help of computerized point-of-sale systems and enterprise asset management tools.

Trade Discount

A reduction in the listed price of goods or services offered by sellers to buyers as an incentive or for bulk purchases, not recorded separately in financial books.

Catalog List Price

The advertised price of a product or service in a catalog, before any discounts or promotions.

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