Question

Flannigan Company manufactures and sells a single product that sells for $450 per unit; variable costs...

Flannigan Company manufactures and sells a single product that sells for $450 per unit; variable costs are $270. Annual fixed costs are $800,000. Current sales volume is $4,200,000. Compute the current margin of safety in dollars for Flannigan Company.

Multiple Choice $1,560,000. $2,000,000. $2,200,000. $2,895,652. $2,460,000.

0 0
Add a comment Improve this question Transcribed image text
Answer #1

Selling price for the product = $450

Variable cost for the product = $270

Contribution = $180

Contribution Margin Ratio = 40%

Total Fixed Expense = $800000

Break Even point in sales = $800,000/40% = $2,000,000

Actual Sales = $4,200,000

Margin of Safety in sales = Actual Sales - BE Sales = $2,200,000

Add a comment
Know the answer?
Add Answer to:
Flannigan Company manufactures and sells a single product that sells for $450 per unit; variable costs...
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions
ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT