Use the Information Below to Answer the Following Question(s)

question 76

Multiple Choice

Use the information below to answer the following question(s) .Dr.Mickey Finn performs a certain procedure for $400.00.The fixed costs are $8,000 and variable costs are $200.00 per procedure.
-What is the margin of safety assuming 100 procedures are performed?

• A)$16,000 or 40 times
• B)$20,000 or 50 times
• C)$24,000 or 60 times
• D)$40,000 or 100 times
• E)$50,000 or 110 times

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Definitions:

Par Value

The face value of a bond or stock as stated by the issuing company, often the minimum amount the security can be sold for.

Stockholders' Equity

The value of a company divided among its shareholders, often represented as the difference between assets and liabilities.

Additional Paid-In Capital

The amount of money investors have paid for shares above the nominal value during stock issuances, reflecting excess capital received by a company.

Dividends In Arrears

The unpaid dividends on preferred shares that have not been distributed to shareholders, typically because a company has insufficient profits.