In: Accounting
Molander Corporation is a distributor of a sun umbrella used at resort hotels. Data concerning the next month’s budget appear below:
Selling price per unit | $ | 30 |
Variable expense per unit | $ | 20 |
Fixed expense per month | $ | 7,500 |
Unit sales per month | 1,000 | |
Required:
1. What is the company’s margin of safety?
2. What is the company’s margin of safety as a percentage of its sales?