Tag: Definition of Contribution Margin
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Marginal Revenue in Business
The scholarly definition and reality are two different perspectives. The student is taught that marginal revenue equals the additional dollars generated for an additional single unit of sales. It is literally taken right down to the micro measurement. This is simple to understand but in small business, the scope of its meaning and impact are substantial to the…
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Fixed Costs – Explanation and Examples
‘Fixed costs’ is a business term used mostly in cost accounting. It has several meanings based on its usage. The most common definition associated with fixed costs is expenses that must be paid regardless of production or sales volume. The best example is rent for a company. It doesn’t matter whether you produce or sell one widget…
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Alcohol Costs – Monitor Closely
In the restaurant business, alcohol is the single best margin generator. If you are going to have a profit, this is where the money is made.
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The Cost of One Putt
Using a large database, I calculated the average cost of one putt for each professional golfer. In business, this is known as the marginal cost of doing business.