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Reggie's Repair Shop has a monthly target profit of $21,000. Variable costs are 40% of sales, and monthly fixed costs are $27,000. Requirements 1. Compute the monthly margin of safety in dollars if the shop achieves its income goal. 2. Express Reggie's margin of safety as a percentage of target sales. 3. Why would Reggie's management want to know the shop's margin of safety? Requirement 1. Compute the monthly margin of safety in dollars if the shop achieves its income goal. Select the labels and enter the amounts to compute Reggie's Repair Shop's monthly margin of safety in dollars. = Margin of safety in dollars =

Reggie's Repair Shop has a monthly target profit of $21,000. Variable costs are 40% of sales, and monthly fixed costs are $27,000. Requirements 1. Compute the monthly margin of safety in dollars if the shop achieves its income goal. 2. Express Reggie's margin of safety as a percentage of target sales. 3. Why would Reggie's management want to know the shop's margin of safety? Requirement 1. Compute the monthly margin of safety in dollars if the shop achieves its income goal. Select the labels and enter the amounts to compute Reggie's Repair Shop's monthly margin of safety in dollars. = Margin of safety in dollars =

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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Reggie's Repair Shop has a monthly target profit of $21,000. Variable costs are 40% of sales, and monthly fixed costs are $27,000. Requirements 1. Compute the monthly margin of safety in dollars if the shop achieves its income goal. 2. Express Reggie's margin of safety as a percentage of target sales. 3. Why would Reggie's management want to know the shop's margin of safety? Requirement 1. Compute the monthly margin of safety in dollars if the shop achieves its income goal. Select the labels and enter the amounts to compute Reggie's Repair Shop's monthly margin of safety in dollars. Margin of safety in dollars = =
Transcribed Image Text:Reggie's Repair Shop has a monthly target profit of $21,000. Variable costs are 40% of sales, and monthly fixed costs are $27,000. Requirements 1. Compute the monthly margin of safety in dollars if the shop achieves its income goal. 2. Express Reggie's margin of safety as a percentage of target sales. 3. Why would Reggie's management want to know the shop's margin of safety? Requirement 1. Compute the monthly margin of safety in dollars if the shop achieves its income goal. Select the labels and enter the amounts to compute Reggie's Repair Shop's monthly margin of safety in dollars. Margin of safety in dollars = =
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