Contribution Margin Per Machine Hour Can Be Calculated by Dividing

question 15

Multiple Choice

Contribution margin per machine hour can be calculated by dividing:

• A) machine hours required per unit by sales margin per unit.
• B) contribution margin per unit by machine hours required per unit.
• C) total contribution margin per unit by total sales revenue per unit.
• D) total machine hours required by total contribution margin.

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Definitions:

Operating Activities

Activities directly related to the day-to-day operations of a business, such as selling products or services, which are reflected in the company's cash flow from operating activities.

Direct Method

A cash flow statement preparation method that lists specific operating cash receipts and payments, directly showing sources and uses of cash.

Indirect Method

A cash flow statement approach that adjusts net income for changes in non-cash accounts to calculate cash from operating activities.

Operating Activities

Activities directly related to the operation of the business, including cash flows from operations, investing, and financial activities.