Question
Robert's Repair Shop has a monthly target profit of $ 28000. Variable costs are 80 % of sales, and monthly fixed costs are $12000. 1.
Robert's Repair Shop has a monthly target profit of $ 28000. Variable costs are 80 % of sales, and monthly fixed costs are $12000.
1. Compute the monthly margin of safety in dollars if the shop achieves its income goal.
2. Express Robert's margin of safety as a percentage of target sales.
3. Why would Robert's management want to know the shop's margin of safety?
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Construction accounting and financial management
Authors: Steven j. Peterson
2nd Edition
135017114, 978-0135017111
