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The following is a business contribution format income statement for last month: Sales 1,200,000 Less: variable expenses 800,000 Contribution Margin 400,000 Less: Fixed expenses 300,000
The following is a business contribution format income statement for last month:
Sales 1,200,000
Less: variable expenses 800,000
Contribution Margin 400,000
Less: Fixed expenses 300,000
Net income $100,000
The company has no beginning or ending inventories and produced and sold 20,000 units during the month.
a. What is the company's margin of safety in dollars?
b. What is the company's degree of operating leverage?
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