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Cottage Industries is a small business producing handmade baskets in rural Yorkshire

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Cottage Industries is a small business producing handmade baskets in rural Yorkshire. The baskets are sold at a price of £12 each and the variable cost of producing each basket is £10. The fixed costs incurred by Cottage Industries are £400 per month. The break-even volume of production per month is:

In Q.1 above, Cottage Industries is planning to produce and sell 400 units. The margin of safety for Cottage Industries is:

In Q.1 above, if the price of a basket were to increase to £14, variable costs and fixed costs remaining the same, the break-even volume of production per month will: