Molander Corporation is a distributor of a sun umbrella used at resort hotels. Data concerning the next month's budgetappear below:Selling price per unitVariable expense per unitFixed expense per monthUnit sales per month1. Margin of safety (in dollars)2. Margin of safety percentage$28$14$ 12,0401,010Required:1. What is the company's margin of safety? (Do not round intermediate calculations.)2. What is the company's margin of safety as a percentage of its sales? (Round your percentage answer to 2 decimalplaces (i.e. .1234 should be entered as 12.34).)%

lling price per unit riable expense per unit xed expense per month it sales per month. largin of safety (in dollars) argin of safety percentage $28 $14 $ 12,040 1,010 uired: hat is the company's margin of safety? (Do not round intermediate calculations.) What is the company's margin of safety as a percentage of its sales? (Round your percentage answer to es (i.e. .1234 should be entered as 12.34).) %

lling price per unit riable expense per unit xed expense per month it sales per month. largin of safety (in dollars) argin of safety percentage $28 $14 $ 12,040 1,010 uired: hat is the company's margin of safety? (Do not round intermediate calculations.) What is the company's margin of safety as a percentage of its sales? (Round your percentage answer to es (i.e. .1234 should be entered as 12.34).) %

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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From 27th Edition, Carl Warren, James M. Reeve, Jonathan Duchac Chapter 18-21, Margin of Safety If Canace Company, with a break-even point at $960,000 of sales, has actual sales of $1,200,000, 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. % b. If the margin of safety for Canace Company was 20%, fixed costs were $1,875,000, and variable costs were 80% of sales, what was the amount of actual sales (dollars)? (Hint: Determine the break-even in sales dollars first.)