Given the budget sales two times that of break even sales then the margin of safety will be how many percentage
Answers
Answer:
Explanation:
In budgeting and break-even analysis, the margin of safety is the gap between the estimated sales output and the level by which a company’s sales could decrease before the company will become unprofitable. This signals management of the risk of loss that may happen as the business is subjected to changes in sales, especially when a significant amount of sales are at risk of decline or unprofitability. A low percentage of margin of safety might cause a business to cut expenses while a high spread of margin assures a company that it is protected from sales variability.
it comes under margin safety
Answer:
50%
Explanation:
The answer is 50%, Margin of safety= budgeted sales - breakeven sales , hence if the breakeven sales is x and the budgeted sales is 2x therefore, margin of safety will be x ie, 50%