The term contribution margin ratio is the percentage of contribution over total revenue. It is used in cost-volume-profit analysis, a form of management accounting.

contribution margin is that amount which anyone unit generate towards recovery of fixed cost after fulfilling the variable cost.

breakeven = fixed cost / contribution margin ratio

contribution margin ratio = sales - variable cost / sales

Contribution margin ratio is overall total contribution margin while contribution margin ration per unit is the allocation of total production contribution margin to per unit basis.

Formula for calculating average Contribution margin

Average contribution margin = total contribution margin / total number of units