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DO IT! 5 Zootsuit Inc, makes travel bags that sell for $56 each. For the coming year, management expects fixed costs to total
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Answer #1

1. Contribution margin = Sale- variable cost/sale= 56-42/56 = 25%
Break even sale = Fixed cost/margin

= 320,000/25% = 1,280,000

2. Margin of safety = 1,382,400-1,280,000= 102,400

MoS ratio= 7% (Mos/CS)

3.

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