What is Math Tot”s margin of safety?


Question Description:

25

What is Math Tot”s margin of safety? 1 answer below » Math Tot sells a learning system that helps preschool and elementary students learn basic math facts and concepts. The company”s income statement from last month is as follows: Total Per Unit Sales $600,000 $12.00 Variable expenses 350,000 7.00 Contribution margin 250,000 $ 5.00 Fixed expenses 175,000 Operating income $ 75,000 Required What is Math Tot”s contribution margin ratio? Its variable cost ratio? What is Math Tot”s margin of safety? If Math Tot”s View complete question » Math Tot sells a learning system that helps preschool and elementary students learn basic math facts and concepts. The company”s income statement from last month is as follows: Total Per Unit Sales $600,000 $12.00 Variable expenses 350,000 7.00 Contribution margin 250,000 $ 5.00 Fixed expenses 175,000 Operating income $ 75,000 Required What is Math Tot”s contribution margin ratio? Its variable cost ratio? What is Math Tot”s margin of safety? If Math Tot”s sales were to increase by $100,000 with no change in fixed expenses, by how much would net operating income increase? Math Tot”s managers have determined that variable costs per unit will increase by 16% beginning next month. To offset this increase in costs, they are considering a 10% increase in the sales price. Market research indicates that the price increase will result in a 2% decrease in the number of learning systems Math Tot sells. What will be Math Tot”s expected net operating income if the price increase is implemented? View less » Jun 11 2014 04:04 PM

Answer

25