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AveGali [126]
3 years ago
15

Mcmurtry Corporation sells a product for $160 per unit. The product's current sales are 12,700 units and its break-even sales ar

e 11,176 units. The margin of safety as a percentage of sales is closest to:
A. 85 %
B. 87%
C. 15%
D. 13%
Business
1 answer:
Luda [366]3 years ago
4 0

Answer:

The correct answer is:

13% (D)

explanation:

The margin of safety in accounting refers to the amount of sales that are above the break-even sales. It is the amount by which a company's sale can reduce, before the company stops making profit, hence it is the amount of sales that bring profit, after every cost in production has been deducted.

to calculate the margin of safety, we will first of all find the difference between the total sales and the break-even point as follows:

Total units sold = 12,700

margin of safety = 11,176 units

Break-even point = 12,700 - 11,176 = 1,524 units

Next we are asked to express the margin of safety as a percentage of the sales. This is done as follows:

(margin of safety ÷ total sales) × 100

= (1,524 ÷ 12,700) × 100 = 12%

and the closest answer in the option to 12% is 13%, hence the answer is 13%

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The Matrix structure is a structure when the organization needs a stronger horizontal alignment or cooperation to meet goals, functionally designed organizations should adopt this structure. This type of structure is a combination of functional and divisional chains.
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You are expected to do a presentation of your business plan to a group of potential investors. Explain how you would respond to
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3 years ago
The units of an item available for sale during the year were as follows: Jan. 1 Inventory 40 units at $165 $6,600 Aug. 13 Purcha
Volgvan

Answer:

a. FIFO - Inventory Used: $39900  Remaining Inventory: $14700

b. LIFO - Inventory Used: $41700 Remaining Inventory: $12900

c. Weighted Average Cost - Inventory Used: $40950 Remaining Inventory: $13650

Explanation:

Jan 01. Beginning inventory = 40 x $165 = $6600

Aug 13. Purchases 200 x $180 = $36000

Nov 30. Purchases 60 x $200 = $12000

Ending inventory = 75 units

Inventory Used = 300 – 75 = 225

(a) First-In-First-Out (FIFO)

This is the method where the inventory first received is the one that is used first. Common method when the inventory is perishable and would be wasted if left too long.

Inventory Used:

40 x $165 = $6600

185 x $180 = $33300

Total = $39900

Remaining Inventory:

15 x $180 = $2700

60 x $200 = $12000

Total = $14700

(b) Last-In-First-Out

Method whereby the inventory received latest is used first. Common in goods that are bulky. the inventory on top (latest purchased) is used first.

Inventory Used:

60 x $200 = $12000

165 x $180 = $29700

Total = $41700

Remaining Inventory:

40 x $165 = $6600

35 x $180 = $6300

Total = $12900

(c) Weighted Average Cost

This is whereby you divide the cost of goods sold by the number of units available for sale.

54,600 / 300 = $182

Inventory Used: 225 x $182 = $40950

Remaining inventory = 75 x $182 = $13650

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3 years ago
What is the intersection of the assessed probability and severity of a hazard called in the RM process?
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Answer:

(1) Assessment

Explanation:

The intersection of the assessed probability and severity of a hazard in the risk management process is called 'risk assessment'

Risks are usually assessed in two broad areas namely: Probability of occurrence and Impact.

Probability of occurrence has to do with the degree of likelihood that a risk will materialize while 'impact' tries to access how much damage the risk is likely to cause, in the event that it materializes.

In summary, risk management usually views risk as a function of probability and impact.

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