lower contribution margin
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Two products were sold. Total budgeted sales and actual total sales in number of units were identical to the units budgeted. Actual unit variable cost s and sales prices were the same as budgeted. Actual contribution margin was lower than budgeted.
What could be the reason for the lower contribution margin?
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Solution Summary
This posting accounts for lower contribution margin.
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Contribution margin is a cost accounting concept that allows a company to determine the profitability of individual products.
contribution margin = Product Revenue - Product Variable Costs
= ...
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