The mathematical equation for computing required sales to obtain target net income is:

The mathematical equation for computing required sales to obtain target net income is:

Required sales =

a. Variable costs + Target net income.

b. Variable costs + Fixed costs + Target net income.

c. Fixed costs + Target net income.

d. No correct answer is given.

Marshall Company had actual sales of $600,000 when break-even sales were $420,000. What is the margin of safety ratio?

a. 25%.

b. 30%.

c. 33 1/3%.

d. 45%.