Magpie Inc. sells a single product for $40 per unit. Variable production costs are $12 per unit. Fixed overhead costs amount $54,000 per month. Variable selling costs are $8 per unit. Fixed selling costs are $6,000 per month. Last month, the company produced 10,000 units and sold 8,000 units.

Whats the margin of safety percentage if the company achieves the pre-tax profit of $200,000?

• A.

  65%

• B.

  8.33%

• C.

  76.92%

• D.

  91.67%

Magpie Inc. sells a single product for $40 per unit. Variable production costs are $12 per unit. Fixed overhead costs amount $54,000 per month. Variable selling costs are $8 per unit. Fixed selling costs are $6,000 per month. Last month, the company produced 10,000 units and sold 8,000 units.

How many units must the company sell to achieve a pre-tax profit of $200,000?

• A.

  20,000

• B.

  66,667

• C.

  13,000

• D.

  50,000