If a business had sales of $3,814,000 and a margin of safety of 20%, the break-even point was:a. $4,576,800 b. $762,800 c. $6,865,200 d. $3,051,200 There are no graphs or diagrams in the image.

Answered: If a business had sales of $3,814,000…

If a business had sales of $3,814,000 and a margin of safety of 20%, the break-even point was Oa. $4,576,800 Ob. $762,800 Oc. $6,865,200 Od. $3,051,200

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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Question

If a business had sales of $3,814,000 and a margin of safety of 20%, the break-even point was:

a. $4,576,800
b. $762,800
c. $6,865,200
d. $3,051,200

There are no graphs or diagrams in the image.

Expert Solution

Step 1

Margin of safety % = Margin of safety in dollars/Actual sales

Margin of safety in dollars = Actual sales*Margin of safety %

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

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

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