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Problem No. 4 (20 %) Iron Decor manufactures decorative iron fences. In preparing for next year's operations, management has developed the following estimates (budget): (
Problem No. 4 (20 %) Iron Decor manufactures decorative iron fences. In preparing for next year's operations, management has developed the following estimates (budget): ( assumed the Units Sold = Units Produced and the Tax Rate is 30 %) Total Budgeted amount for the year Per Unit $50.00 Sales (20,000 units) $1,000,000 $200,000 $10.00 Direct materials $180,000 $ 9.00 Direct labor (variable) $ 5.00 $100,000 Variable manufacturing overhead $120,000 $ 6.00 Variable selling and administrative expense Fixed manufacturing overhead $90,000 Fixed selling and administrative expense $80,000 b. Compute the margin of safety in UNITS SOLD and SALES IN DOLLARS (4%)
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