Question

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 $ 26 Variable expense per unit $ 18 Fixed expense per month $ 6,960 Unit sales per month 1,020 Required: 1. What is the company’s margin of safety? (Do not round intermediate calculations.) 2. What is the company’s margin of safety as a percentage of its sales? (Round your percentage answer to 2 decimal places (i.e. 0.1234 should be entered as 12.34).)

Answer #1

**Income statement**

Sales(1020×$26) | $26520 |

(-) variable expenses(1020×$18) | ($18360) |

Contribution margin | $8160 |

(-) fixed expenses | ($6960) |

Net operating income | $1200 |

P/v ratio /contribution margin ratio= contribution margin/sales×100

= $8160/$26520×100

= 30.77%

1)Margin of safety = profit/p/v ratio

= $1200/30.77%

= $3899.90

2) margin of safety as a percentage of sales

= $3899.90/$26520×100

= 14.70%

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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
$
26
Variable expense per unit
$
18
Fixed expense per month
$
6,960
Unit sales per month
1,020
Required:
1. What is the company’s margin of safety? (Do not round
intermediate calculations.)
2. What is the company’s margin of safety as a percentage of its
sales? (Round your percentage answer to 2 decimal places...

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 $ 25 Variable expense per unit $ 15
Fixed expense per month $ 8,600 Unit sales per month 1,010
Required:
1. What is the company’s margin of safety? (Do not round
intermediate calculations.)
2. What is the company’s margin of safety as a percentage of its
sales? (Round your percentage answer to 2 decimal places...

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
$
29
Variable expense per unit
$
13
Fixed expense per month
$
13,760
Unit sales per month
1,010
Required:
1. What is the company’s margin of safety? (Do not round
intermediate calculations.)
2. What is the company’s margin of safety as a percentage of its
sales? (Round your percentage answer to 2 decimal places...

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
$
24
Variable expense per unit
$
17
Fixed expense per month
$
6,090
Unit sales per month
1,020
Required:
1. What is the company’s margin of safety? (Do not round
intermediate calculations.)
2. What is the company’s margin of safety as a percentage of its
sales?

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
$
25
Variable expense per unit
$
12
Fixed expense per month
$
11,570
Unit sales per month
1,040
Required:
1. What is the company’s margin of safety? (Do not round
intermediate calculations.)
2. What is the company’s margin of safety as a percentage of its
sales? (Round your percentage answer to 2 decimal places...

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
$
24
Variable expense per unit
$
12
Fixed expense per month
$
9,600
Unit sales per month
950
Required:
1. What is the company’s margin of safety? (Do not round
intermediate calculations.)
2. What is the company’s margin of safety as a percentage of its
sales? (Round your percentage answer to 2 decimal places...

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 $ 27 Variable expense per unit $ 17
Fixed expense per month $ 8,900 Unit sales per month 1,040
Required: 1. What is the company’s margin of safety? (Do not round
intermediate calculations.) 2. What is the company’s margin of
safety as a percentage of its sales? (Round your percentage answer
to 2 decimal places...

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
$
25
Variable expense per unit
$
19
Fixed expense per month
$
4,860
Unit sales per month
960
Required:
1. What is the company’s margin of safety? (Do not round
intermediate calculations.)
2. What is the company’s margin of safety as a percentage of its
sales? (Round your percentage answer to 2 decimal places...

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
$
23
Variable expense per unit
$
15
Fixed expense per month
$
6,800
Unit sales per month
1,000
Required:
1. What is the company’s margin of safety? (Do not round
intermediate calculations.)
2. What is the company’s margin of safety as a percentage of its
sales? (Round your percentage answer to 2 decimal places...

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
$
24
Variable expense per unit
$
18
Fixed expense per month
$
5,340
Unit sales per month
1,040
Required:
1. What is the company’s margin of safety? (Do not round
intermediate calculations.)
2. What is the company’s margin of safety as a percentage of its
sales? (Round your percentage answer to 2 decimal places...

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