# Dousmann Company: Compute margin of safety in dollars; margin of safety ratio

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For Dousmann Company actual sales are $1,200,000 and break-even sales are $840,000.

Compute the following (a) the margin of safety in dollars and (b) the margin of safety ratio.

Margin of safety in dollars $

Margin of safety ratio

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#### Solution Preview

Margin of safety in dollars = Actual sales - Break-even sales

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#### Solution Summary

This solution helps compute the margin of safety.

$2.49