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Forums › Ask CIMA Tutor Forums › Ask CIMA P1 Tutor Forums › Contribution
Dear Tutors,
I couldn’t find exact answer to this question, I hope you can help me to clarify:
When calculating contribution per unit (and using e.g. at break-even analysis), should we deduct variable other costs as well? I mean besides variable production cost, should we remove other (selling, distribution) variable costs from the selling price?
Thank you in advance!
Hi – yes all variable costs should be deducted when calculating contribution per unit – this includes all variable production costs as well as all variable selling/ distribution expenses too.
Hope that clarifies
Kindest Regards
Cath