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Contribution Margin, Beak-even, Margin of Safety, and Target Net Income 1. LV Ltd. Makes travel bags that sell for P3,920 each. For the coming year, management expects fixed costs to total P22,400,000 and variable costs per unit of P2,940.
Problem 1: Compute the following:
a. Break-even point in sales and units. b. Margin of safety and margin of safety ratio assuming actual sales are P96,768,000. c. Sales required to earn net income of P28,700,000.
Financial Statement Analysis and Preparation
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T he focus of the report is to determine the extent to which you are comfortable relying on the financial statements as presented by management .
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