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ID: 2330305 • Letter: U

Question

usg.edu/d2/lms/quizzing/user/attempt/quiz start frame.d217ou-1616328&isprv-&drc-0&qi-2382603&cfal-08dnb0 west Woods CengageUniversity of West...-6 Mr. world Premiere G Google e uwa 1 myuwa / Ba. D SoundCloud Down Principles of Accounting II Section NO2 Fall goo 4 Communication Assessments v Grades', Resources a Okafor: Attempt 1 Question 5 (0.5 points) Brooklyn sells a single product to wholesalers. The company's budget for the upcoming year revealed anticipated unit sales of 31,600, a selling price of $20, variable cost per unit of $8, and total fixed costs of $360,000. Brooklyn's safety margin in units is: (13,400) 0. 1,600 13,600 an amount other than those above. Save Question 6 (0.5 points)

Explanation / Answer

Selling Price = $20
Variable Cost per unit = $8
Fixed Costs = $360,000

Contribution Margin per unit = Selling Price - Variable Cost per unit
Contribution Margin per unit = $20 - $8
Contribution Margin per unit = $12

Breakeven Point in units = Fixed Costs / Contribution Margin per unit
Breakeven Point in units = $360,000 / $12
Breakeven Point in units = 30,000

Safety Margin in units = Unit Sales - Breakeven Point in units
Safety Margin in units = 31,600 - 30,000
Safety Margin in units = 1,600