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2 years ago

Ensley Corporation has provided the following data concerning its only product:

Business

1 answer:

Minchanka [31]2 years ago

5 0

Answer:

28%

Explanation:

Given that,

Selling price = $ 200 per unit

Current sales = 30,300 units

Break-even sales = 21,816 units

Current sales in dollars:

= Current sales × Selling price

= 30,300 units × $200 per unit

= $6,060,000

Break even sales in dollars:

= Break-even sales × Selling price

= 21,816 units × $200 per unit

= $4,363,200

Margin of Safety as a percentage of sales:

= (Current sales in dollars - Break even sales in dollars) ÷ Current sales in dollars

= ($6,060,000 - $4,363,200) ÷ $6,060,000

= $1,696,800 ÷ $6,060,000

= 0.28 or 28%

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Answer:

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