17. Compute the margin of safety (total sales – breakeven sales) using the following data: selling...
17. Compute the margin of safety (total sales – breakeven sales) using the following data:
selling price $35 per unit variable cost $25 per unit fixed expenses $8,000 per month Total unit sales 2,500 units per month
Homework Answers
Break even units = Fixed cost/Contribution margin per unit
= 8,000/(35-25)
= 800
Margin of Safety = Sales - Breakeven sales
= 2500 - 800
= 1700 units
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