Margin of safety ratio = margin of safety/sales revenue
contribution margin ratio = (sales - variable costs) / Sales
Formula for contribution margin ratio = Sales
rs 10000 as mos = pft/pvratio therefore 4000/0.4= 10000
net profit/sales
In business, an operating margin is the revenue of a business minus the operating expenses. It is the ratio of operating income divided by net sales.
the margin of safety provided to creditors
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%
Contribution of margin safety x margin of safety
The contribution margin ratio increases when?
contribution margin ratio = (sales - variable costs) / Sales
Profit Margin ratio is the comparison of profit as a percentage of revenue and calculated as follows Profit Margin ratio = Net Profit/Revenue
a. sales-net operation incomeb. sales-(variable expenses/contribution margin)c. sales-(fixed expenses/contribution margin ratio)d. sales-(variable expenses + fixed expenses)
The margin of safety is the dose of a drug that is lethal for 1% of tested animals divided by the dose that produces the maximum effect for 99% of tested animals. The larger this ratio is, the better you toxicology data will (and thus, the safer the drug will be)
gross margin ratio is calculated as >GROSS PROFIT/NET SALES
sales-variable cost= contribution
Formula for contribution margin ratio = Sales
Break even point = Fixed cost / Contribution margin ratio Contribution margin ratio = (sales - variable cost ) / Sales