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Firmin Company makes a product that sells for $12 per unit. The company pays $7 per unit for the variable costs of the produc

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Answer #1

Break even units = Fixed cost/Contribution margin per unit

= 80,000/(12-7) = 16,000

Margin of Safety

= (Sales units-Break even units) /Sales units

= (20,000-16,000)/20,000

= 20%

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