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Perform a cost-volume-profit analysis including the margin of safety for LMN Corporation using the following data: Component Total ($) Sales Revenue $100,000 Variable Costs $60,000
Perform a cost-volume-profit analysis including the margin of safety for LMN Corporation using the following data:
| Component | Total ($) |
|---|---|
| Sales Revenue | $100,000 |
| Variable Costs | $60,000 |
| Fixed Costs | $20,000 |
The breakeven point is 5,000 units.
Requirements:
- Calculate the margin of safety in dollars and as a percentage.
- Present the analysis in a detailed table format.
- Discuss the significance of the margin of safety in CVP analysis.
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Financial Statement Analysis and Security Valuation
Authors: Stephen Penman
5th edition
78025311, 978-0078025310
