The Contribution Margin and the Manufacturing Margin Are Usually Equal

question 90

True/False

The contribution margin and the manufacturing margin are usually equal.

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Definitions:

Net Income

The total earnings of a company after subtracting all expenses, including taxes and operating costs, indicative of the company’s profitability.

Short-term Receivables

Amounts due to a company that are expected to be received within one year from the date of the balance sheet.

Fair Value

The cost one would incur to sell an asset or to assume a liability during a structured exchange with participants in the market at the time of assessment.

Net Realizable Value

The estimated selling price of goods minus the sum of the cost of completion and the costs necessary to make the sale.