a. If Canace Company, with a break-even point at $331,200 of sales, has actual sales of $480,000, what is the margin of safety expressed (1) in dollars and (2) as a percentage of sales? Round the percentage to the nearest whole number. 1. 2. 148,800 31 ✓ % b. If the margin of safety for Canace Company was 35%, fixed costs were $1,503,775, and variable costs were 65% of sales, what was the amount of actual sales (dollars)? (Hint: Determine the break-even in sales dollars first.) $ 5,370,625 X
a. If Canace Company, with a break-even point at $331,200 of sales, has actual sales of $480,000, what is the margin of safety expressed (1) in dollars and (2) as a percentage of sales? Round the percentage to the nearest whole number. 1. 2. 148,800 31 ✓ % b. If the margin of safety for Canace Company was 35%, fixed costs were $1,503,775, and variable costs were 65% of sales, what was the amount of actual sales (dollars)? (Hint: Determine the break-even in sales dollars first.) $ 5,370,625 X
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Margin of Safety
a. If Canace Company, with a break-even point at $331,200 of sales, has actual sales of $480,000, what is the margin of safety expressed (1) in dollars and (2) as a
percentage of sales? Round the percentage to the nearest whole number.
1.
2.
148,800 ✔
31 ✓ %
b. If the margin of safety for Canace Company was 35%, fixed costs were $1,503,775, and variable costs were 65% of sales, what was the amount of actual sales
(dollars)?
(Hint: Determine the break-even in sales dollars first.)
5,370,625 X
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