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

question 272

Multiple Choice

Use the information below to answer the following question(s) .
Ava's Fruit Cups has a monthly target operating income of $5,425. Variable expenses are 30% of sales and monthly fixed expenses are $9,800.
-What is Ava's Fruit Cups monthly margin of safety in dollars if the business achieves its operating income goal?

• A) $1,750
• B) $6,525
• C) $7,750
• D) $11,070

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Definitions:

Brazing Department

A specific section within a manufacturing facility where brazing, a metal-joining process, is carried out.

Conversion Costs

Expenses directly related to the transformation of raw materials into finished goods, typically including both labor and manufacturing overhead.

First-In, First-Out

An inventory valuation method where the oldest inventory items are recorded as sold first, ensuring that the costs recorded are of the oldest products.

Assembly Department

A specific section in a manufacturing company where parts are assembled into final products.