Hudson Co. reports the contribution margin income statement for 2015. HUDSON CO. Contribution Margin Income Statement For Year Ended December 31, 2015
Sales (9,100 units at $495 each) $ 4,504,500 Variable costs (9,100 units at $396 each) 3,603,600 Contribution margin $ 900,900 Fixed costs 633,600 Pretax income $ 267,300 1. Assume Hudson Co. has a target pretax income of $157,000 for 2016.
1. What amount of sales (in dollars) is needed to produce this target income?
2. If Hudson achieves its target pretax income for 2016, what is its margin of safety (in percent) keep answer with one decimal place?