Question

Margin of Safety is the difference between :

A. planned sales and planned profit.
B. actual sales and break-even sales.
C. planned sales and actual sales
D. planned sales and planned expenses.

Explain it.​

Answer 1

Answer:

Margin of safety (safety margin) is the difference between the intrinsic value of a stock and its market price. Another definition: In break-even analysis, from the discipline of accounting, margin of safety is how much output or sales level can fall before a business reaches its break-even point.