Breakeven point & Margin of safety
accountguru
1. Last month when Harrison Creations, Inc., sold 40,000 units, total sales were $300,000, total variable expenses were $240,000, and fixed expenses were $45,000. |
Required: | ||||||
a. | What is the company’s contribution margin (CM) ratio? | |||||
b. | Estimate the change in the company’s net operating income if it were to increase its total sales by $1,500.
2. [The following information applies to the questions displayed below.]
| |||||
|
| |||||
|
|
4. Mohan Corporation is a distributor of a sun umbrella used at resort hotels. Data concerning next month’s budget appear below: |
|
|
|
Selling price | $25 | per unit |
Variable expenses | $15 | per unit |
Fixed expenses | $8,500 | per month |
Unit sales | 1,000 | units per month |
Required: | |
a. | Compute the company’s margin of safety. |
b. Compute the company’s margin of safety as a percentage of its sales. (%)
| |
|
- 11 years ago
Purchase the answer to view it
- breakeven_point__margin_of_safety_16_sept.docx