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    Question

    A company has fixed costs of ₹10 lakh, variable cost

    per unit ₹50, and selling price per unit ₹75. If sales units are 60,000. Compute margin of safety units. 
    A 10,000 units Correct Answer Incorrect Answer
    B 20,000 units Correct Answer Incorrect Answer
    C 40,000 units Correct Answer Incorrect Answer
    D 50,000 units Correct Answer Incorrect Answer

    Solution

    BEP = Fixed Cost / Contribution per unit = ₹10L / (75 – 50) = ₹10L / ₹25 = 40,000 units MOS = Sales Units- BEP Units = 60,000- 40,000 = 20,000 units

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