Question
Curvy Confections is considering building a new plant in Europe. It predicts sales at the new plant to be 42,000 units at $4.00?/unit. Below is
Curvy Confections is considering building a new plant in Europe. It predicts sales at the new plant to be
42,000
units at
$4.00?/unit.
Below is a listing of estimated? expenses:
Category | Total Annual Expenses | ?% of Annual Expense that are Fixed |
Materials | $25,000 | 10?% |
Labor | $25,000 | 20?% |
Overhead | $40,000 | 40?% |
?Marketing/Admin | $20,000 | 60?% |
A European firm was contracted to sell the product and will receive a commission of
15?%
of the sales price. No U.S. home office expenses will be allocated to the new facility.? (Round intermediary dollar calculations to the nearest whole dollar and round percentages to
oneminus?tenth
?percent.)
The margin of safety percentage for Curvy Confections is
A.
21.1?%.
B.
40.7?%.
C.
152?%.
D.
70.1?%.
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