Contribution Analysis can help a business to identify both profitable products and those that might need more development in the future.
Posts tagged as “Contribution-Costing Technique”
So, should the business accept a special unprofitable order below total cost? At the first sight, it might appear to be unwise.
The question is whether the business should stop making a product when it is unprofitable, or continue making the unprofitable product?
Contribution-Costing Technique is a method of costing in which only Direct Costs are allocated to products, not Indirect Costs (Overheads).