Tye runs a business which sells a magazine. He has worked out the following figures for the magazine he is going to sell. He estimates that they can sell 20,000 magazines a year, with a selling price of £3.50 each. He expects the business' fixed costs to be £5 000 per annum with annual rent to be a further £6,000. Raw materials and staff wages to produce all the magazines will cost £30 000 per annum. Past paper: (d) Discuss how useful knowing the margin of safety will be to Tye in running his business. 6 marks sapety ? dent fy mhe adramtages and discadvantagKs f calculata why do we calculato Vhe margin of margin of safety
Tye runs a business which sells a magazine. He has worked out the following figures for the magazine he is going to sell. He estimates that they can sell 20,000 magazines a year, with a selling price of £3.50 each. He expects the business' fixed costs to be £5 000 per annum with annual rent to be a further £6,000. Raw materials and staff wages to produce all the magazines will cost £30 000 per annum. Past paper: (d) Discuss how useful knowing the margin of safety will be to Tye in running his business. 6 marks sapety ? dent fy mhe adramtages and discadvantagKs f calculata why do we calculato Vhe margin of margin of safety
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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I need help to answer the question
( i need to write the advantages and disadvantages only)
Transcribed Image Text:Tye runs a business which sells a magazine. He has worked out the following figures
for the magazine he is going to sell. He estimates that they can sell 20,000 magazines
a year, with a selling price of £3.50 each.
He expects the business' fixed costs to be £5 000 per annum with annual rent to be a
further £6,000. Raw materials and staff wages to produce all the magazines will cost
£30 000 per annum.
Past paper:
(d) Discuss how useful knowing the margin of safety will be to Tye in running his business.
6 marks
why do
we calculate he
maregin of sapety ?
| dent fs Yhe advantages and discadvand ages f cekculahr
morgin of safety
disadvantages g calculatr
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