Finance & Accounting / FP&A
Contribution Margin CM
Revenue minus the costs that rise and fall with each unit sold, what each sale contributes toward covering fixed costs and profit.
The fork, why two teams get different numbers
Contribution margin and gross margin are constantly swapped, but they draw the cost line differently.
In the Metric Library
- The full fork, both definitions worked all the way through
- The trap that makes the number lie, on a real export
- Every formula variant, spelled out
- The reconciliation anchor, what to tie it to and when to refuse
Reference: IMA Statements on Management Accounting ยท standard cost-accounting principles