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The margin of safety is equal to?

Underw34 ∙

Lvl 1

∙ 16y ago

Updated: 4/28/2022

a. sales-net operation income

b. sales-(variable expenses/contribution margin)

c. sales-(fixed expenses/contribution margin ratio)

d. sales-(variable expenses + fixed expenses)

Wiki User

∙ 16y ago

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If the volume of sales is 6000000 and sales at the break-even point amount to 4800000 is the margin of safety 25?

To calculate the margin of safety, use the formula: Margin of Safety = (Actual Sales - Break-even Sales) / Actual Sales × 100%. Here, actual sales are 6,000,000 and break-even sales are 4,800,000. The margin of safety is (6,000,000 - 4,800,000) / 6,000,000 × 100% = 20%. Therefore, the margin of safety is not 25%.

Can the margin of safety ever be negative?

yes it can be negative.

What is it called when Sales can decline before losses are incurred?

margin of safety

Low margin of safety would be indicate?

low break even point

What does a times interest earned ratio indicate?

the margin of safety provided to creditors

Related Questions

What is margin of safety ratio?

Margin of safety ratio = margin of safety/sales revenue

Profit margin formula?

Contribution of margin safety x margin of safety

If Hartman Co has fixed costs of 36000 and a contribution margin ration of 24 percent If expected sales are 200000 what is the margin of safety as a percent to sale?

First you need to find the break even sales. Break even sales = fixed expenses/ CM ratio Break even sales = 3600/.24 = 15,000 Then find the margin of safety dollars. margin of safety dollars = budgeted sales - break even sales margin of satefy dollars = 200,000 - 15,000 = 185,000 Then you can find the margin of safety percent Margin of safety percent = margin of safety dollars/ budgeted sales dollars margin of safey percent = 185,000/200,000 = 92.5%

If the volume of sales is 6000000 and sales at the break-even point amount to 4800000 is the margin of safety 25?

To calculate the margin of safety, use the formula: Margin of Safety = (Actual Sales - Break-even Sales) / Actual Sales × 100%. Here, actual sales are 6,000,000 and break-even sales are 4,800,000. The margin of safety is (6,000,000 - 4,800,000) / 6,000,000 × 100% = 20%. Therefore, the margin of safety is not 25%.

What is a margin of safety as well as how it can help minimize risk. Use examples in your explanation.?

Margin of safety is the difference between the intrinsic value of a stock and its market price. To have a margin of safety, one must manage one's financial needs thriftily.

How do you calculate the margin of safety?

total sales - breakeven= marginal of safety

Explain what a margin of safety is as well as how it can help minimize risk Use examples in your explanation?

Margin of safety is the difference between the intrinsic value of a stock and its market price. To have a margin of safety, one must manage one's financial needs thriftily.

What does it mean to have a margin of safety?

Time and Space

Standard margin of safety in pharmacy?

SSM = LD1/ED99 SSM = Standard Safety Margin LD1 = Lethal dose for 1% ED99 = Effective Dose for 99%

What are the release dates for Suspense - 1949 Margin for Safety 3-27?

Suspense - 1949 Margin for Safety 3-27 was released on: USA: 27 February 1951

Can the margin of safety ever be negative?

yes it can be negative.

What is the margin of safety in LD50 200mg and ED50 60mg?

3.333

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