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Help me compute the Margin of Safety in Dollars and Ratio. Bill Johnson, sales manager, and Diane Buswell, controller, at Current Designs are beginning to
Help me compute the Margin of Safety in Dollars and Ratio.
Bill Johnson, sales manager, and Diane Buswell, controller, at Current Designs are beginning to analyze the cost considerations for one of the composite models of the kayak division. They have provided the following production and operational costs necessary to produce one composite kayak. Bill and Diane have asked you to provide a cost-volume-profit analysis, to help them finalize the budget projections for the upcoming year. Bill has informed you that the selling price of the composite kayak will be $2,300. (a) Your answer is correct. Calculate unit variable costs. Unit variable costs $ per unit (e) Your answer is incorrect. Based on the most recent sales forecast, Current Designs expects to sell 1,000 units of this model. Calculate the margin of safety in dollars and the margin of safety ratio. (Round percentage to 2 decimal places, 25.50%.) Margin of safety $ Margin of safety ratio % Your answer is correct. Determine the unit contribution margin. Contribution margin per unit Attempts: 1 of 3 used (c) Your answer is correct. Using the unit contribution margin, determine the break-even point in sales units for this product line. Break-even point units eTextbook and Media (d) Your answer is correct. Assume that Current Designs would like to earn net income of $313,200 on this product line. Using the unit contribution margin, calculate the number of units that need to be sold to achieve this goal. Number of units to be sold unitsStep by Step Solution
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