contribution

Contribution

Money placed in an individual retirement account (IRA), an employer-sponsored retirement plan, or other retirement plan for a particular tax year. Contributions may be deductible or nondeductible, depending on the type of account.

Contribution

Money placed into an annuity or retirement account. Most of the time, contributions are small and are made on a regular basis, especially monthly. Occasionally, however, one may make a large, one-time contribution to purchase the annuity or retirement account. Contributions are combined and invested and, along with any earnings, are eventually repaid to the annuitant or account holder in monthly installments.

Fig. 26 Contribution. Output and sales of chairs.

contribution

the difference between SALES REVENUE and VARIABLE COSTS. If total contributions are just large enough to cover FIXED COSTS then the producer BREAKS EVEN; if contributions are less than fixed costs the producer makes a LOSS; while if contributions exceed fixed costs then the producer makes a PROFIT. Fig. 26 shows how contributions provide a fund out of which total fixed costs must be paid before any profit is made. See MARGINAL COSTING.

contribution

the difference between a product's SALES REVENUE and its VARIABLE COSTS. If total contributions are just large enough to cover FIXED COSTS then the producer BREAKS EVEN; if contributions are less than fixed costs, the producer makes a LOSS; while if contributions exceed fixed costs then the producer makes a PROFIT. See LOSS MINIMIZATION, MARGINAL COST PRICING.

contribution

(1) An appraisal principle that says the value of an improvement is the amount it adds to the value of the property as a whole,not the value of the improvement standing alone in a void. A backyard workshop in a prestigious neighborhood might not add any value at all and could be considered an eyesore detracting from value, but might be worth $10,000 in a different neighborhood.(2) A legal principle holding that if a judgment is collected against one who was held guilty of negligence,assault,defamation,fraud,or some other tort,then that person may obtain a contribution from others against whom the same judgment was rendered, for their proportionate share of the judgment.Likewise,persons jointly liable for a debt,such as partners or cotenants,are responsible to pay their share to the other if one pays the entire amount.