Cost Accounting

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timer Asked: Oct 17th, 2018
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Question Description

Chapters 2 and 3 (in part) cover the concepts of gross margin and contribution margin and how companies use these measures for business analysis.According to the authors, Datar and Rajan (2018), the gross margin measures how much a company can charge for its products over and above the cost of acquiring or producing them. Contribution margin indicates how much of a company's revenues are available to cover fixed costs. It helps in assessing the risk of losses (p. 88). Datar and Rajan (2018) go on to state gross margin and contribution margin are related but give different insights (p. 88). One such example is a company operating with a low gross margin will have low risk of loss if its fixed costs are small. What other insights or observations do you have with regard to gross margin and contribution margin? Do those insights change depending on the industry sector being considered; if so, why?

Your initial posting should be 250-500 words

Tutor Answer

Perfectsolutions
School: UIUC

find the attached completed paper. If you have another one please invite me to bid. Thanks

Running head: GROSS AND CONTRIBUTION MARGINS

Gross and Contribution Margins
Student’s Name
Institution

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GROSS AND CONTRIBUTION MARGINS

2

Gross and Contribution Margins
Different firms will always need to make decisions based on the costs incurred in
different processes within the business. This explains the importance of cost accounting, ...

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Anonymous
Tutor went the extra mile to help me with this essay. Citations were a bit shaky but I appreciated how well he handled APA styles and how ok he was to change them even though I didnt specify. Got a B+ which is believable and acceptable.

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