Posted: February 17th, 2016

Calculate the company’s margin of safety

Strong Wood Company is a distributor of patio furniture. Data concerning the next month’s budget appear below.
Selling price $290.00
Variable expense $174.00
Fixed expense $158,000.00
Unit sales 1,500 units per month

a. What is the company’s margin of safety? (Please show all work so I am able to learn the formulas)
b. What is the company’s margin of safety as a percentage of sales? (Please show all work so I am able to learn the formulas)