If Kirwan Company, with a break-even point at $527,000 of sales, has actual sales of $850,000, what is the margin of safety expressed (1) in dollars and (2) as a percentage of sales? 1. fill in the blank 1 of 2 $ 2. fill in the blank 2 of 2 % b. If the margin of safety for Kirwan Company was 25%, fixed costs were $1,325,625, and variable costs were 75% of sales, what was the amount of actual sales (dollars)? (Hint: Determine the break-even in sales dollars first.) fill in the blank 1 of 1 $
If Kirwan Company, with a break-even point at $527,000 of sales, has actual sales of $850,000, what is the margin of safety expressed (1) in dollars and (2) as a percentage of sales? 1. fill in the blank 1 of 2 $ 2. fill in the blank 2 of 2 % b. If the margin of safety for Kirwan Company was 25%, fixed costs were $1,325,625, and variable costs were 75% of sales, what was the amount of actual sales (dollars)? (Hint: Determine the break-even in sales dollars first.) fill in the blank 1 of 1 $
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
If Kirwan Company, with a break-even point at $527,000 of sales, has actual sales of $850,000, what is the margin of safety expressed (1) in dollars and (2) as a percentage of sales? 1. fill in the blank 1 of 2 $ 2. fill in the blank 2 of 2 % b. If the margin of safety for Kirwan Company was 25%, fixed costs were $1,325,625, and variable costs were 75% of sales, what was the amount of actual sales (dollars)? (Hint: Determine the break-even in sales dollars first.) fill in the blank 1 of 1 $
Expert Solution
Step 1: Introduction
The break even sales are calculated as fixed costs divided by contribution Margin Ratio. The margin of safety is calculated as difference between current sales and break even sales.
Trending now
This is a popular solution!
Step by step
Solved in 3 steps
Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education