Which of the Following Is True Regarding the Contribution Margin

question 151

Multiple Choice

Which of the following is true regarding the contribution margin ratio of a single product company?

• A) As fixed expenses decrease, the contribution margin ratio increases.
• B) The contribution margin ratio multiplied by the variable expense per unit equals the contribution margin per unit.
• C) If sales increase, the dollar increase in net operating income can be computed by multiplying the contribution margin ratio by the dollar increase in sales.
• D) The contribution margin ratio increases as the number of units sold increases.

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