Molander Corporation is a distributor of a sun umbrella used at resort hotels. Data concerning the next month's budget appear below: $ 24 Selling price per t Variable expense per unit Fixed expense per month $ 12 $ 9,840 970 Unit sales per month Required: 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 decimal places (i.e. 1234 should be entered as 12.34).) 1. Margin of safety (in dollars)
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
![Exercise 6-8 (Algo) Compute the Margin of Safety [LO6-7]
Molander Corporation is a distributor of a sun umbrella used at resort hotels. Data concerning the next month's budget appear below:
$ 24
Selling price per i
Variable expense per unit
Fixed expense per month
$ 12
Unit sales per month
$ 9,840
970
Required:
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 decimal places (i.e.
1234 should be entered as 12.34).)
1. Margin of safety (in dollars)
2. Margin of safety percentage
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