Projected 20X1 annual data for Bobcat Company at a budgeted sales volume of 100,000 units,...
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Accounting
Projected 20X1 annual data for Bobcat Company at a budgeted sales volume of 100,000
units,
and which manufactures and sells a single product, are shown in the table below.
| Per unit | Total | Percent of sales | |
| Selling price | $30.00 | $3,000,000 | 100% |
| Variable expenses | 12.00 | 1,200,000 | 40% |
| Contribution margin | 18.00 | 1,800,000 | 60% |
| Fixed expenses | 7.20 | 720,000 | 24% |
| Operating income | $10.80 | $1,080,000 | 36% |
Completely independent to any other solutions you may have computed, assume that the reak-even point in dollars for Bobcat Company is $1,600,000.
Calculate the margin of safety in dollars for Bobcat Company at the 100,000 unit sales volume given in the table above.
A.
$1,600,000
B.
$1,400,000
C.
$880,000
D.
$2,000,000
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