Use the Following Information to Determine the Margin of Safety

question 165

Multiple Choice

Use the following information to determine the margin of safety in dollars:
$\begin{array}{ll}\text { Unit sales }&50,000 \text { unit }\\ \text { Dollar sales } & \$ 500,000 \\\text { Fixed costs } & \$ 204,000 \\\text { Variable costs } & \$ 187,500\end{array}$

• A) $88,500
• B) $108,500
• C) $173,600
• D) $326,400
• E) $500,000

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Definitions:

Market Value

The amount of money a willing buyer would pay a willing seller for goods, services, or assets in a competitive marketplace.

Minor

A person who is under the legal age of adulthood, typically considered to be under 18 years old in many jurisdictions.

Timely Manner

Refers to completing tasks or responsibilities within an expected or agreed-upon timeframe.

Mentally Incompetent

A legal status indicating that an individual lacks the capacity to make decisions for themselves due to mental limitations or impairments.