Contribution margin is also known as .a.net profit.b.gross profit.c.net loss.d.marginal income .

Breaking Down the Problem

1. Identify the definitions of the terms provided: net profit, gross profit, net loss, and marginal income.
2. Determine which of these terms directly correlates with contribution margin.

Relevant Concepts

• Contribution Margin: This refers to the sales revenue minus variable costs. It represents the portion of sales revenue that exceeds total variable costs and contributes to covering fixed costs.

Analysis and Detail

1. Net Profit: This is the amount left after all expenses, including both variable and fixed costs, have been deducted from revenue. It is the bottom line of the income statement.
2. Gross Profit: This is the revenue from sales minus the cost of goods sold (COGS), which are variable costs related to production.
3. Net Loss: This occurs when expenses exceed revenue, indicating negative profit.
4. Marginal Income: This term typically refers to the additional income generated from selling one more unit, closely related to contribution margin.

In the context of this question, the best option that aligns with the concept of contribution margin is "marginal income," as it reflects the income available after covering variable costs.

Verify and Summarize

After comparing the definitions, "marginal income" (d) is the correct association since it highlights the income that contributes to covering fixed costs after fixed expenses are deducted.

Final Answer

Contribution margin is also known as marginal income (d).