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Accounting

Use the following information to determine the margin of safety in dollars: ( equation= (expected sales- break even sales)/ expected sales)
unit sales 50,000 units
dollar sales 500,000
fixed costs 204,000
variable cost 187,500

During the past year a company had total fixed costs of $70,000. Its product sold for $9 per unit. Variable costs during this time equaled $5 per unit. Next year the company is anticipating a 4% increase in total fixed costs and a $1 per unit decrease in variable costs, but would like to maintain its current selling price per unit. How many units must the company sell next year to earn $1,000,000?

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M958872

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