The contribution margin seen by the production department is different from the one on the income statement because it does NOT account for which of the following? Select One A.Inventory carrying costs B.Total Unit Cost C.Workforce complement D.All of the above
The contribution margin seen by the production department is different from the one on the income statement because it does NOT account for:
A. Inventory carrying costs
The contribution margin on the income statement typically considers all relevant costs, including variable production costs and direct costs associated with the production of goods. However, the contribution margin seen by the production department may focus more narrowly on the direct costs associated with production and may not include broader costs such as inventory carrying costs. Inventory carrying costs are associated with holding and storing inventory, and they are not always factored into the contribution margin at the production department level.
