7 THE CONTRIBUTION MARGIN IS THE DIFFERENCE PROFIT CENTER MANAGER H...

12-7 The contribution margin is the difference

profit center manager has control over both cost

between sales revenue and variable expenses.

and revenue. An investment center manager has

The segment margin is the amount remaining

control over cost and revenue and investment

after deducting traceable fixed expenses from

funds.

the contribution margin. The contribution margin

is useful as a planning tool for many decisions,