P$.5-43$

E$-$M$\mathrm{.}5-34.$ Computing margin of safety $($Leaming Objection $5)$

Robbie's Repair Shop has a monthly target profit of $$31,000.$ Variable

costs are $20\%$ of sales, and monthly fixed costs are $$19,000.$

Requirements

Compute the monthy margin of safety in dollars if the shop

achieves its income goal.

Express Robbie's margin of safety as a percentage of target sales.

of safeity?

Tip: utiize a CVP Income statement using the Total dollars and Ratio columns.

You do not have unit data and that's okay. Use the CM techniques to

answer the questions.