Question
Margin of safety in dollars is Blank______.
Multiple choice question.
net income minus break-even sales
break-even sales minus budgeted (or actual) sales
net income minus fixed costs
budgeted (or actual) sales minus break-even sales
Multiple choice question.
net income minus break-even sales
break-even sales minus budgeted (or actual) sales
net income minus fixed costs
budgeted (or actual) sales minus break-even sales
Answers
GPT-4o mini
The correct answer is:
**budgeted (or actual) sales minus break-even sales**
This option accurately defines the margin of safety in dollars, which represents the amount by which sales can decline before the business reaches its break-even point.
**budgeted (or actual) sales minus break-even sales**
This option accurately defines the margin of safety in dollars, which represents the amount by which sales can decline before the business reaches its break-even point.