Mohan Corporation is a distributor of a sun umbrella used at resort hotels. Data concerning next month’s budget appear below:
Selling price | $25 | per unit |
Variable expenses | $15 | per unit |
Fixed expenses | $8,500 | per month |
Unit sales | 1,000 | units per month |
Required: | |
1. | Compute the company’s margin of safety. (Omit the "$" sign in your response.) |
Margin of safety | $ 3,750 |
2. |
Compute the company’s margin of safety as a percentage of its sales. (Omit the "%" sign in your response.)
|
Margin of safety | 15 % |
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