Select the Appropriate Classification of Each of the Costs Listed

question 39

Multiple Choice

Select the appropriate classification of each of the costs listed below.* Each classification may be used more than once, and it is possible that one or more of the classifications may not be used at all.
-Variable manufacturing overhead

• A)deduction from Revenue in calculation of Contribution Margin
• B)deduction from Revenue in calculation of Gross Margin
• C)deduction from Revenue in calculation of both Contribution Margin and Gross Margin
• D)deduction from both Contribution Margin and Gross Margin in calculating Operating Income

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Definitions:

Partnership

A legal form of business operation between two or more individuals who share management and profits.

Partner

An individual who shares ownership of a business or an endeavor with one or more persons, often sharing in profits and responsibilities.

Profitability

The degree to which a business or activity yields financial profit or gain, often measured as a ratio of net income to revenue.

Guarantee

A formal promise or assurance, often provided by a third party, that certain conditions or obligations will be met.