The Difference Between Sales Price Per Unit and Variable Cost

question 146

Multiple Choice

The difference between sales price per unit and variable cost per unit is the:

• A) Gross profit from sales.
• B) Gross margin per unit.
• C) Fixed cost per unit.
• D) Margin of safety per unit.
• E) Contribution margin per unit.

Define sales mix and its influence on business strategy and operations.

Recognize the necessity of covering all costs and generating profits for long-term business sustainability.

Understand the significance of EBITDA in internal decision-making processes.

Realize the importance of choosing products with higher contribution margins for profitability in the short run.

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