Question
Margin of Safety a. If Lake and Dirt Company, with a break-even point at $3,000,000 of sales, has actual sales of $4,000,000, what is the
Margin of Safety
a. If Lake and Dirt Company, with a break-even point at $3,000,000 of sales, has actual sales of $4,000,000, what is the margin of safety expressed (1) in dollars and (2) as a percentage of sales? 1. Margin of Safety (dollars) fill in the blank 1 of 2$ 2. Margin of Safety (percentage) fill in the blank 2 of 2%
b. If the margin of safety for Lake and Dirt Company was 15%, fixed costs were $4,590,000, and variable costs were 60% of sales, what was the amount of actual sales (dollars)? (Hint: Determine the break-even in sales dollars first.) Actual sales in dollars fill in the blank 1 of 1$
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