If the total contribution margin increases and fixed costs do not change, then net income can be expected to a. decrease by an equal amount. b. increase by an amount equal to the increase in contribution margin times the CM ratio. c. increase by an equal amount. d. none of these.

If the total contribution margin increases and fixed costs do not change, then net income can be expected to a. decrease by an equal amount. b. increase by an amount equal to the increase in contribution margin times the CM ratio. c. increase by an equal amount. d. none of these.

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter3: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 14MC: When fixed costs increase and all other variables remain unchanged, the contribution margin will A....

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Concept explainers

Manufacturing Costs

Manufacturing cost is the total cost of procuring or producing a product. In other words, the manufacturing cost is the cost that an individual or business owner undertakes for the manufacturing of goods.

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15. If the total contribution margin increases and fixed costs do not change, then
net income can be expected to
a. decrease by an equal amount.
b. increase by an amount equal to the increase in contribution margin times
the CM ratio.
c. increase by an equal amount.
d. none of these.

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