Mercantile Corporation has sales of $2,000,000, variable costs of $800,000, and fixed costs of$900,000. Mercantile's margin of safety ratio is3O.15.#5O .25.O.33.O..75.a$4CmyCayoteJo LO%5TAMacBook Pro< 6Y&7WP8UsO白C

For computing Margin of safety, we need profits and contribution margin ratioMargin of safety is the…

Answered: Mercantile Corporation has sales of…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Idaho Corp. has fixed costs of $20,000 and a contribution margin ratio of 50%. Currently, sales are $82,000. What is Idaho's margin of safety? A) $28,000 B) $35,000 C) $42,000 D) $70,000 C B D OA
If Kirwan Company, with a break-even point at $412,500 of sales, has actual sales of $750,000, what is the margin of safety expressed (1) in dollars and (2) as a percentage of sales?1. fill in the blank 1 of 2$2. fill in the blank 2 of 2% b. If the margin of safety for Kirwan Company was 35%, fixed costs were $1,581,125, and variable costs were 65% of sales, what was the amount of actual sales (dollars)? (Hint: Determine the break-even in sales dollars first.)fill in the blank 1 of 1$
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5. Company XYZ is currently producing and selling 20,000 units. The selling price per unit is $ 7 while the variable cost ratio is 20%. Assuming total fixed costs of $ 30,000, what is the margin of safety in ($) value?
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a. If Canace Company, with a break-even point at $281,400 of sales, has actual sales of $420,000, what is the margin of safety expressed (1) in dollars and (2) as a percentage of sales? Round the percentage to the nearest whole number. b. If the margin of safety for Canace Company was 30%, fixed costs were $1,243,200, and variable costs were 70% of sales, what was the amount of actual sales (dollars)?(Hint: Determine the break-even in sales dollars first.)
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Mercantile Corporation has sales of $2,000,000, variable costs of $800,000, and fixed costs of $900,000. Mercantile's margin of safety ratio is 15. O 25. .33. .75.