If a Company Had a Mixed Cost Structure,every Dollar of Revenue

question 112

True/False

If a company had a mixed cost structure,every dollar of revenue after covering the fixed costs would be pure profit.

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Definitions:

Contribution Margin

Contribution margin represents the portion of sales revenue that remains after variable costs are deducted, indicating how much contributes to covering fixed costs and generating profit.

Variable Manufacturing Overhead

Costs in the production process that vary with the level of production output, such as utilities for machinery.

Direct Labour

refers to the workforce directly involved in the manufacture of goods or provision of services.

Fixed Manufacturing Overhead

Indirect manufacturing costs that remain relatively constant regardless of the level of production, such as rent, salaries, and insurance.