Rustic Replicas is owned and operated by a craftsman who makes replicas of historic firearms for museums,sportsmen,and collectors.He is currently producing 43 flintlock muskets per month.The cost data for the muskets are as follows: $$\begin{array} { | l | r | }
\hline \text { Price per unit } & \$ 750 \
\hline \text { Variable costs per unit } & 480 \
\hline \text { Fixed costs per month } & 8,100 \
\hline
\end{array}$$ If Rustic expects to sell 40 units per month,what is his margin of safety expressed in units per month?
A) 10 units
B) 30 units
C) 16 units
D) 24 units

Question

Rustic Replicas is owned and operated by a craftsman who makes replicas of historic firearms for museums,sportsmen,and collectors.He is currently producing 43 flintlock muskets per month.The cost data for the muskets are as follows: $$\begin{array} { | l | r | } 
\hline \text { Price per unit } & \$ 750 \
\hline \text { Variable costs per unit } & 480 \
\hline \text { Fixed costs per month } & 8,100 \
\hline
\end{array}$$ If Rustic expects to sell 40 units per month,what is his margin of safety expressed in units per month?
A) 10 units
B) 30 units
C) 16 units
D) 24 units

Quizplus · Accepted Answer

Margin of safety = Budgeted sales - Actual sales= 40 - 43= 3 units

Rustic Replicas Is Owned and Operated by a Craftsman Who