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May I get some help on this problem?? Thank you!! Ruth is a creative, artistic person. A few years ago, she had enough of spending
May I get some help on this problem?? Thank you!!
Ruth is a creative, artistic person. A few years ago, she had enough of spending $5 for birthday cards. She could do it herself-and she did! She created beautiful, fun cards for many occasions, and sent them to all of her friends and family. In the process, she got a lot of feedback from the recipients suggesting she could sell them. Hmm. Now there's an idea. Ruth doesn't want to charge as much as the big greeting card companies, and yet she wants to make a little profit on these cards in order to make it worth her time. She is contemplating a selling price of $2.90 and estimates the cost of paper and other miscellaneous items to be about $0.80 per card. Her fixed costs are quite small, since she runs the small business out of her home. She estimates her fixed costs at just $714 per year. Before actually promoting this business, she wants to feel confident that she will make money. Naturally, she turns to her CVP skills to help answer the following questions. If she sells 560 cards next year, how much operating income will she make? Operating income What will her margin of safety be in both units and sales dollars at this level of activity? Margin of safety units units Margin of safety dollars Last saved 22 hours ago. Saved work will be auto-submitted on the due date. Auto-submission can take up to 10 minutes. Attempts: 1 of 3 usedStep by Step Solution
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