Response to the following questions:
a. If Glendive Company, with a break-even point at $792,000 of sales, has actual sales of $1,200,000, what is the margin of safety expressed (1) in dollars and (2) as a percentage of sales?
b. If the margin of safety for Spearfish Company was 30%, fixed costs were $1,750,000 and variable costs were 80% of sales, what was the amount of actual sales (dollars)? (Hint: Determine the break-even in sales dollars first.)