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Rainbow Manufacturing has the following data: Selling price: $140 Variable manufacturing cost: $87 Fixed manufacturing cost $250,000 per month Variable selling & adminstrative costs $22
Rainbow Manufacturing has the following data:
Selling price: $140
Variable manufacturing cost: $87
Fixed manufacturing cost $250,000 per month
Variable selling & adminstrative costs $22
Fixed selling & adminstrative costs $188,000 per month
If Rainbow Manufacturing has actual monthly sales of $2,100,000 and desires an operating profit of $75,000 per month, what is the margin of safety in sales dollars?
a. $242,972
b. $154,299
c $75,000
d. $250,000
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