The Smith Corporation Has the Following Data for Current Year

question 105

Multiple Choice

The Smith Corporation has the following data for current year: $$\begin{array} { l l } \text { Selling price per unit } & \$ 15 \\\text { Variable cost per unit } & \$ 9 \\\text { Fixed costs } & \$ 45,000 \\\text { Units sold } & 10,000 \text { units }\end{array}$$
- What will the margin of safety in units be (rounded to the nearest whole unit) ?

• A)667
• B)2,500
• C)4,000
• D)7,500

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Definitions:

Total Current

The overall flow of electric charge through a circuit, determined by the sum of all individual current paths within the circuit.

Parallel Circuit

An electric circuit in which the same voltage is applied across multiple paths, allowing current to divide among the paths.

Inductive Reactance

The opposition to the change in current flow in a circuit element caused by its inductance, affecting the phase angle between voltage and current in AC circuits.

Reactive Power

The component of electric power that oscillates between the source and load, associated with the energy stored in the field of an inductor or capacitor.