The Budgeted Income Statement Presented Below Is for Burkett Corporation

The budgeted income statement presented below is for Burkett Corporation for the coming fiscal year. If Burkett Corporation is able to achieve the budgeted level of sales, its margin of safety in dollars would be: $\begin{array}{ll}\text { Sales \( (50,000 \) units) }&&\$1,000,000\\\text { Costs:}\\\text { Direct materials } & \$ 270,000 \\\text { Direct labor } & 240,000 \\\text { Fixed factory overhead } & 100,000 \\\text { Variable factory overhead } & 150,000 \\\text { Fixed marketing costs } & 110,000 \\\text { Variable marketing costs } & \underline{50,000}& \underline{920,000} \\\text { Pretax income }&& \underline{\$80,000}\end{array}$

A) $275,862.
B) $262,500.
C) $150,000.
D) $172,420.
E) $310,115.

Correct Answer:

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