Question

he excess of expected sales over the sales level at the break-even point is known as the: Multiple Choice Sales turnover. Profit margin. Contribution margin. Relevant range. Margin of safety.

Answer 1

Answer:

Margin of safety

Explanation:

Margin of safety means the level at which actual sales exceeds Break even point in sales. In reality, its purpose is to protect a business again loss. It also provides a measure of how sensitive profits are, in relation to ever changing level of sales.

If a company incurs higher margin of safety, then the risk of making loss will be lower and if a company incurs lower margin of safety, the risk of making loss will be higher.