The Margin of Safety in the Flaherty Company Is $24,000

question 39

Multiple Choice

The margin of safety in the Flaherty Company is $24,000. If the company's sales are $120,000 and its variable expenses are $80,000, its fixed expenses must be:

• A)$16,000.
• B)$8,000.
• C)$32,000.
• D)$24,000.

Recognize the impact of transactions on accounts receivable, accounts payable, and cash flows.

Comprehend the purpose and components of the major financial statements, including the balance sheet, income statement, statement of cash flows, and statement of changes in equity.

Calculate owner's equity based on assets and liabilities.

Grasp the concept of net income, net loss, and how they are determined.

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Definitions:

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