The correct answer is B. Contribution margin.
Contribution margin is the amount of revenue remaining after deducting variable costs. It is a measure of a company’s profitability and can be used to assess the contribution of a profit centre to the overall profitability of the business in the long-run.
Taxable income is the amount of income that is subject to taxation. It is calculated by deducting all allowable expenses from gross income.
Performance margin is a measure of a company’s performance over a period of time. It is calculated by dividing net income by revenue.
Responsibility margin is a measure of the contribution of a responsibility centre to the overall profitability of the business. It is calculated by deducting all controllable costs from revenue.
In conclusion, contribution margin is the best measurement by the centre’s for the contribution of a profit centre to the overall profitability of the business in the long-run.