Contribution margin is the amount of money left over from sales after deducting variable costs. It represents the portion of sales that helps cover fixed costs and eventually contributes to profit. By ...

When a business wants to calculate exactly how much revenue it earns from the sale of its products, it looks at the contribution margin ratio. The contribution margin ratio tells a company how much ...

The concept of a contribution margin comes from the need for business managers to understand how profitable their businesses have become. For most managers, this is as simple as looking at something ...

Portions of this article were drafted using an in-house natural language generation platform. The article was reviewed, fact-checked and edited by our editorial staff. Contribution margin is used to ...

Both metrics assess a company's profitability, but in different ways Claire Boyte-White is the lead writer for NapkinFinance.com, co-author of I Am Net Worthy, and an Investopedia contributor.

Traditional and contribution margin income statements provide a detailed picture of a company's finances for a given period of time. While both serve the purpose of showing whether a company has a net ...