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Profit using Marginal was 12,500. Absorption profit 13,500. Fixed over head 5000. What is the contribution?

Accounting Economics Management
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Question added by Steve Alq
Date Posted: 2016/07/21
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RATHEESH RAVEENDRAN
by RATHEESH RAVEENDRAN , Graduate Teacher (Head of Business Department) , HANIMAADHOO SCHOOL

Answer is  18500

 

Contibution = Profit + Fixed overhead

Zaheer uddin Raja
by Zaheer uddin Raja , Accounts Supervisor , Pakistan International Airlines

Revenue less V.costs = Contribution

Contribution less F.costs = Profit

Therefore;

Profit plus F.costs = Contribution

Now, please calculate contribution under each costing method as per question.

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