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c) Explain what is meant by the terms 'margin of safety' and 'break-even'. (3 marks) The following information relates to parts d-g of this question:
c) Explain what is meant by the terms 'margin of safety' and 'break-even'. (3 marks) The following information relates to parts d-g of this question: A company manufactures a single car part. Budgeted sales units for the forthcoming month are 80,000 with a unit selling price of 28. Total fixed costs for the month are 400,000 and total variable costs are 960,000. Required: d) Calculate the number of sales units required to break even. (4 marks) e) Calculate the current % margin of safety. (4 marks) f) Calculate the number of units that need to be sold in order to obtain a profit of 250,000. (4 marks) g) Calculate the new break-even point if variable costs are decreased by 10%
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