Explain what is meant by “contribution analysis”. Carefully define the term and provide examples to illustrate it. Think of an example were you had to evaluate the incremental costs and benefits of different options in order to make a decision.
The selling prise, and the direct (variable) costs of a range, of products, to compute the extent to which each units old will pay for indirect (fixed) costs and contribute to the net incom. Contribution analysis shows whether or not a firm is constrained by fixed or variable cost in achieving higher out put.......................
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Apr 3rd, 2015
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