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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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