margin of safety ratio

margin of safety ratio
The margin of safety expressed as a percentage of a given level of activity. For example, if the sales level achieved is £500, 000 and the sales level breakeven point is £400, 000, the margin of safety is £100, 000 and the margin of safety ratio will be:
(£100, 000 × 100)-£500, 000 = 20%.

Big dictionary of business and management. 2014.

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