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

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1143100

2026-03-03 17:30

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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%.

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