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A company sells bags. Next month's budget is as follows: Selling Price=$50/bag Variable Expenses per unit=$25/bag Total Fixed Expenses for one month=$10,000/month Volume of Bag Sales=1,000bags Based on the company's budgeted sales, what is the company's Margin of Safety in dollars? Show all work explanation computation formula with steps

A company sells bags. Next month's budget is as follows: Selling Price=$50/bag Variable Expenses per unit=$25/bag Total Fixed Expenses for one month=$10,000/month Volume of Bag Sales=1,000bags Based on the company's budgeted sales, what is the company's Margin of Safety in dollars? Show all work explanation computation formula with steps

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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A company sells bags. Next month's budget is as follows:

Selling Price=$50/bag

Variable Expenses per unit=$25/bag

Total Fixed Expenses for one month=$10,000/month

Volume of Bag Sales=1,000bags

Based on the company's budgeted sales, what is the company's Margin of Safety in dollars? Show all work explanation computation formula with steps 

 

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