Determine the Margin of Safety
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Question 1:
A company makes a single product that it sells for $18 per unit. Fixed costs are $76,000 per month and the product has a contribution margin ratio of 40%. If the company's actual sales are $238,000, its margin of safety is:
(Round your intermediate calculation to the nearest dollar amount.)
$52,000
$48,000
$49,500
$46,000
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Solution Summary
The solution explains how to calculate the margin of safety.
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