A company needs to sell 10,000 units of its only product in order to break even. Fixed costs are $110,000, and the per unit selling price and variable costs are $20 and $9, respectively. If total sales are $220,000, the company’s margin of safety will be equal to: a. $0 b. $20,000 c. $110,000 d. $200,000

Intermediate Financial Management (MindTap Course List)
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ISBN:9781337395083
Author:Eugene F. Brigham, Phillip R. Daves
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Chapter16: Capital Structure Decisions
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A company needs to sell 10,000 units of its only product in order to break even. Fixed costs are $110,000, and the per unit selling price and variable costs are $20 and $9, respectively. If total sales are $220,000, the company’s margin of safety will be equal to:

a. $0

b. $20,000

c. $110,000

d. $200,000

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