EA14. LO 3.5 Marshall & Company produces a single product and recently calculated their break-even point asshown.CurrentUnits sold400Sales price per unitVariable cost per unitContribution margin per unitFixed costs2$$375$550175$ 3,50020Break-even (in units)Contribution margin ratioBreak-even (in dollars)31.82%$11,000What would Marshall's target margin of safety be in units and dollars if they required a $14,000 margin ofsafety?

Compute the margin of safety in units.

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What would Marshall's target margin of safety be in units and dollars if they required a $14,000 margin of safety?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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Question

EA14. LO 3.5 Marshall & Company produces a single product and recently calculated their break-even point as
shown.
Current
Units sold
400
Sales price per unit
Variable cost per unit
Contribution margin per unit
Fixed costs
2$
$
375
$
550
175
$ 3,500
20
Break-even (in units)
Contribution margin ratio
Break-even (in dollars)
31.82%
$11,000
What would Marshall's target margin of safety be in units and dollars if they required a $14,000 margin of
safety?

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