The contribution margin is the amount remaining after what?
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The contribution margin is the amount remaining after what?
1) The Sales Figure at selling prices.
2) The Cost of Goods at purchasing prices.
Number 1 minus number 2 above
Gives you the GROSS MARGIN
Known as gross profit.
I think the question is regarding contribution margin and not gross margin.
Contribution margin:
Sales
Less: Variable costs of sales (both purchases and sales)
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