SUBJECT NAME IS COST ACCOUNT.

ANSWER THE FOLLOWING QUESTION CORRECTLY

Hobbs Company produces one product for which following is information is available.

Product A $ per unit

Selling price 6.00

Direct Material 2.50

Direct Labor 1.40

Variable overhead 1.10

Total Fixed cost $ 120,000 per annum

Sales units 200,000 per annum

Required:

Calculate Margin of safety in units and percentage of sales.