The margin of safety focuses on how much operating income is left over from sales revenue after covering all variable and fixed costs.

Name: The margin of safety focuses on how much operating income is left over from sales revenue after covering all variable and fixed costs.
Brand: Quizplus
Rating: 5.0 (40 reviews)

Question

Quizplus · Accepted Answer

The margin of safety measures how much sales can drop before the company reaches its break-even point, not the amount of operating income left over after covering all costs.

The Margin of Safety Focuses on How Much Operating Income