21.7

Margin of Safety a. If Del Rosario Company, with a break-even point at $326,600 of sales, has actual sales of $460,000, what is the margin of safety expressed (1) in dollars and (2) as a percentage of sales? Round the percentage to the nearest whole number. 1. S 2. b. If the margin of safety for Del Rosario Company was 30%, fixed costs were $1,640,100, and variable costs were 70% of sales, what was the amount of actual sales (dollars)? (Hint: Determine the break-even in sales dollars first.)