# 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

https://brainmass.com/business/finance/determine-margin-safety-204455

#### Solution Summary

The solution explains how to calculate the margin of safety.

$2.49