Kaitlyn's Cakes Had the Following Activity for December

question 93

Multiple Choice

Kaitlyn's Cakes had the following activity for December:
Total cakes sold 23,000
Total revenues $500,000
Total fixed costs 99,000
Total variable costs 350,000
What was Kaitlyn's margin of safety, in dollars?

• A) $330,000
• B) $247,500
• C) $347,500
• D) $170,000

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Definitions:

Historical Rate

The exchange rate at which a foreign currency transaction was valued on the transaction date, used for converting transactions denominated in foreign currencies.

Functional Currency

The primary currency of the principal economic environment in which an entity operates, usually used in preparing financial statements.

Acquisition Consideration

The total value transferred by an acquirer to obtain control of an acquiree, which can include cash, shares, or other assets.

Unrecorded Patent

An unrecorded patent refers to a patent that has been granted but has not been accounted for or reflected in the financial statements of a company.