Question

The Spector Company has sales of $620,000, and the break-even point in sales dollars is $427,800....

The Spector Company has sales of $620,000, and the break-even point in sales dollars is $427,800.

Determine the company's margin of safety as a percent of current sales.

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Answer #1

Margin of safety in percentage = (total current sales - break even sales)/total current sales

= ($620000 - $427800)/$620000

= 31%

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