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    Question

    If Selling Price is 9 per unit, variable cost is 5 per

    unit and fixed cost is 100000, what is the Margin of safety in Qty if the budgeted units are 1,00,000.
    A 75000 Correct Answer Incorrect Answer
    B 50000 Correct Answer Incorrect Answer
    C 25000 Correct Answer Incorrect Answer
    D 63500 Correct Answer Incorrect Answer
    E None of these Correct Answer Incorrect Answer

    Solution

    BE Qty = Fixed Cost/ Contribution per unit = 100000/4 = 25000 units and MOS = 100000 – 25000 = 75000 units.

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