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Guthrie Industries manufactures and sells dog collars. The collars sell for $12 each. Information about the company's costs is as follows. Variable manufacturing cost per unit $ 2 Variable selling and administrative cost per unit 1 Fixed manufacturing overhead per month $250,000 Fixed selling and administrative cost per month 200,000 Compute the company's margin of safety if its current monthly sales level is $1,400,000.

Guthrie Industries manufactures and sells dog collars. The collars sell for $12 each. Information about the company's costs is as follows. Variable manufacturing cost per unit $ 2 Variable selling and administrative cost per unit 1 Fixed manufacturing overhead per month $250,000 Fixed selling and administrative cost per month 200,000 Compute the company's margin of safety if its current monthly sales level is $1,400,000.

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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Guthrie Industries manufactures and sells dog collars. The collars sell for $12 each. Information about the company's costs is as follows. Variable manufacturing cost per unit $ 2 Variable selling and administrative cost per unit 1 Fixed manufacturing overhead per month $250,000 Fixed selling and administrative cost per month 200,000 Compute the company's margin of safety if its current monthly sales level is $1,400,000.
Transcribed Image Text:Guthrie Industries manufactures and sells dog collars. The collars sell for $12 each. Information about the company's costs is as follows. Variable manufacturing cost per unit $ 2 Variable selling and administrative cost per unit 1 Fixed manufacturing overhead per month $250,000 Fixed selling and administrative cost per month 200,000 Compute the company's margin of safety if its current monthly sales level is $1,400,000.
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