Mohan Corporation is a distributor of a sun umbrella used at resort hotels. Data concerning the next

Question:

Mohan is a distributor of a sun umbrella used at resort hotels. Data concerning the next month’s budget appear below:
Selling price . . . . . . . . . . . . . . $25 per unit
Variable expense . . . . . . . . . . $15 per unit
Fixed expense . . . . . . . . . . . . $8,500 per month
Unit sales . . . . . . . . . . . . . . . . 1,000 units per month

Required:
1. Compute the company’s margin of safety.
2. Compute the company’s margin of safety as a percentage of its sales.

Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...