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    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

    © BrainMass Inc. brainmass.com October 4, 2022, 1:29 pm ad1c9bdddf
    https://brainmass.com/business/finance/determine-margin-safety-204455

    Solution Summary

    The solution explains how to calculate the margin of safety.

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