What’s it all about?
A technique that allows you to work out selling prices, profitability, the value of following a project all without getting bogged down with calculating how overheads need to be allocated to the products. Knowing how to make decisions using Contribution saves you a lot of time and effort.
Further Reading.
I keep additional materials worth reading at this location:
http://linoit.com/users/Jonathanrooks/canvases/Contribution
Possible Written Questions.
(No indication of marks – the more marks a question gets, the more you are expected to write – detail that is, not just words!) If you can’t answer these, you need to do some more reading. I do ‘find’ questions elsewhere, so these aren’t all questions I have used myself.
- Comment on the strategy a company should adopt when faced with spare capacity.