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e-lub [12.9K]
3 years ago
12

Marigold Corp. reported sales of $2200000 last year (80000 units at $20 each), when the break-even point was 44000 units. Marigo

ld’s margin of safety ratio is:_______
Business
1 answer:
belka [17]3 years ago
8 0

Answer:

the margin of safety ratio is 45%

Explanation:

The computation of the margin of safety ratio is shown below:

The Margin of safety ratio is

= (Actual sales unit - break even sales unit) ÷ (Actual sale unit)

= (80,000 units - 44,000 units) ÷ (80,000 units)

= 36,000 units ÷ 80,000 units

= 45%

Hence, the margin of safety ratio is 45%

We simply applied the above formula so that the correct value could come

And, the same is to be considered

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