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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.)


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    Solution Summary

    The solution explains how to calculate the margin of safety.