The Selling Price Per Unit Minus the Variable Cost Per

question 40

Multiple Choice

The selling price per unit minus the variable cost per unit is called _____.

• A)contribution margin per unit
• B)the breakeven point in units
• C)survival price
• D)fixed price

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Definitions:

Reversing Entries

Journal entries usually made at the beginning of an accounting period to reverse or cancel out adjusting entries from the end of the previous period.

Allowance Method

An accounting technique used to anticipate and adjust for potential future losses from uncollectible accounts receivable.

Uncollectible Accounts

Accounts receivable that are recognized as not being collectible, leading to a write-off as a bad debt expense.

Bad Debts Expense

Bad debts expense is an estimate of the accounts receivable that a company does not expect to collect, treated as an expense on the income statement.