If the unit selling price is $40, the volume of sales is $3,000,000, sales at the break-even point amount to $2,500,000, and the maximum possible sales are $3,300,000, the margin of safety will be 12,500 units.

Question

Quizplus · Accepted Answer

The margin of safety in units is calculated as (Actual Sales - Break-even Sales) / Unit Selling Price. Here, (3,000,000 - 2,500,000) / 40 = 12,500 units.

If the Unit Selling Price Is $40, the Volume of Sales