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Contribution Margin: Definition & Formula

Instructions:

Choose an answer and hit 'next'. You will receive your score and answers at the end.

question 1 of 3

What is a contribution margin?

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1. How is the contribution margin calculated?

2. How is the contribution margin affected by variable expenses?

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About This Quiz & Worksheet

The contribution margin is an important financial calculation in business. This quiz/worksheet will help you assess your understanding of what it is as well as how it is calculated and used.

Quiz & Worksheet Goals

In these assessments you'll be tested on the definitions, affects, implications, and functions of:

  • The contribution margin
  • Variable expenses
  • Negative contribution margins

Skills Practiced

This quiz and worksheet allows students to test the following skills:

  • Defining key concepts - ensure that you can accurately define contribution margin
  • Interpreting information - verify that you can read information regarding the implications of the contribution margin and interpret it correctly
  • Information recall - access the knowledge you've gained regarding the use of the contribution margin and the effects of variable expenses on the contribution margin

Additional Learning

To learn more about contribution margins, review the accompanying lesson Contribution Margin: Definition & Formula. This lesson covers the following objectives:

  • Define contribution margin
  • Understand how the contribution margin is calculated
  • Understand the use and implications of the contribution margin
  • Understand how variable expenses affect the contribution margin
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