Answered: Berea Company expects to sell 9,000…

Berea Company expects to sell 9,000 units. Total fixed costs are $84,000 and the contribution margin per unit is $16.00. Berea's tax rate is 40%. What is the margin of safety in units?

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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Concept explainers

Pricing

Pricing is used as a term in finance and economics, pricing is the process of fixing a value for a product or a service. Pricing establishes a value for a product or service that the customer has to pay. A business can choose from different strategies while deciding to set prices.

Question

Berea Company expects to sell 9,000 units. Total fixed costs are $84,000 and the
contribution margin per unit is $16.00. Berea's tax rate is 40%. What is the margin of
safety in units?
allallatione

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