Assuming a Company's Income Statement Shows a Net Operating Income

Assuming a company's income statement shows a net operating income, which of the following statements is true regarding the contribution margin per unit?

A) It will decrease as the number of units sold increases.
B) It will decrease as the number of units purchased decreases.
C) It indicates the amount that net operating income will increase with the sale of each additional unit.
D) It indicates the amount that variable costs will decrease with the sale of each additional unit.

Correct Answer:

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