Select from the Following the Incorrect Statement Regarding Contribution Margin

question 58

Multiple Choice

Select from the following the incorrect statement regarding contribution margin.

• A) Sales − Fixed costs = Contribution margin
• B) Net income + Total fixed costs = Contribution margin
• C) At the breakeven point (where the company has neither profit nor loss), Total fixed costs = Total contribution margin
• D) Total sales revenue times the contribution margin percentage = Total contribution margin

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Definitions:

RC7S

RC7S refers to a specification for a surface finish, indicating the roughness and texture desired on a machined surface, often used in engineering drawings.

Basic Shaft System

A referencing system for tolerances in mechanical engineering, focusing on the dimensions and fit of shafts.

Basic Hole System

A system of fits commonly used in engineering where the hole size is kept constant, and the shaft size is varied to achieve the desired fit.