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What was the companys margin of safety in dollars

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Reference no: EM132483380

Taharah Industries developed the following information for the product it sells:

Sales price                                    RM50 per unit

Variable cost of goods sold               RM28 per unit

Fixed cost of goods sold                  RM650,000

Variable selling expense 10% of sales price

Variable administrative expense        RM2.00 per unit

Fixed selling expense                    RM400,000

Fixed administrative expense         RM300,000

  • For the year ended 31 December 2018, Taharah produced and sold 100,000 units of product.

Instructions:

Question (a) make a CVP income statement using the contribution margin format for Taharah Industries for 2018.

Question (b) What was the company's break-even point in units in 2018? Use the contribution margin technique.

Question (c) What was the company's margin of safety in dollars in 2018?

Reference no: EM132483380

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