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Calculate the margin of safety in terms of sales revenue

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Problem - Chillmax Company plans to sell 3,500 pairs of shoes at $60 each in the coming year. Unit variable cost is $21 (includes direct materials, direct labor, variable factory overhead, and variable selling expense). Total fixed cost equals $78,000 (includes fixed factory overhead and fixed selling and administrative expense). Break-even units equal 2,000.

Required -

Calculate the margin of safety in terms of the number of units.

Calculate the margin of safety in terms of sales revenue.

Reference no: EM132700233

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