The contribution margin per unit multiplied by the number of units sold is the:

Question

The contribution margin per unit multiplied by the number of units sold is the:

Segment margin.

Total contribution margin.

Contribution margin ratio.

Margin of safety.

Breakeven point.

A plan showing the units of goods expected to be sold and the expected revenue from sales, which is the cornerstone of the master budget, is called the:

Cash budget.

Sales receipts budget.

Cash receipts budget.

Sales budget.

a.

Segment margin.

b.

Total contribution margin.

c.

Contribution margin ratio.

d.

Margin of safety.

e.

Breakeven point.

A plan showing the units of goods expected to be sold and the expected revenue from sales, which is the cornerstone of the master budget, is called the:

a.

Cash budget.

b.

Sales receipts budget.

c.

Cash receipts budget.

d.

Sales budget.

Explanation / Answer

Hi,

Please find the detailed answer as follows:

Part A:

Option C (Total Contribution Margin) is the correct answer.

Explanation:

Contribution per unit is derived by deducting variable cost per unit from selling price per unit. Total Contribution is calculated with the use of this Contribution per unit and Units Sold by the firm.

Part B:

Option E (Sales Budget) is the correct answer.

Explanation:

A Sales Budget is used to estimate the sales for a particular (budget) period. This is done by including the number of units expected to be sold and using (multiplying units with)selling price per unit to derive the total sales revenue.

Thanks.

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