For Oriole Company, actual sales are $1,450,000, and break-even sales are $971,500. Required:
a. Compute the margin of safety in dollars.
b. Compute the margin of safety ratio.

a. Margin of safety in dollars = $478,500

b. Margin of safety ratio = 33%

Explanation:

a. Margin of safety in dollars is calculated as;

= Actual sales - Break even sales

Given that;

Actual sales = $1,450,000

Break even sales = $971,500

Margin of safety in dollars

= $1,450,000 - $971,500

= $478,500

b. Margin of safety ratio is computed as;

= [(Actual sales - Break even sales) / Actual sales] × 100

= [($1,450,000 - $971,500) / $1,450,000] × 100

= [$478,500 / $1,450,000] × 100

= 0.33 × 100

= 33%

the correct answer is economics is a game without winners or losers.

unlike sports or games economic is a game without losers or winner rather it is a game where everyone wins. parties of business doing businesses exchange money with each other and hence exchange is done on the basis of goods. one party takes the goods and other sales it so there is winner on both sides. each party values more highly the good it gets than the good it gives up. both sides exchange only because both intend to increase their value. so there is no concept of lose or win.

c

explanation: