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What is the margin of safety in dollars

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Reference no: EM13521318

Hardwood Seating Co., a manufacturer of chairs, had the following data for 2012.

Sales

2,400 units

Sales price

$40 per unit

Variable costs

$14 per unit

Fixed costs

$19,500

Instructions

(a) What is the contribution margin ratio?

(b) What is the break-even point in dollars?

(c) What is the margin of safety in dollars and as a ratio?

(d) If the company wishes to increase its total dollar contribution margin by 40% in 2013, by how much will it need to increase its sales if all other factors remain constant?

Reference no: EM13521318

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